DeskTrading, a leading expert in innovative Separately Managed Accounts (SMA) technology, is reporting a significant surge in demand for SMAs across the global financial markets, with demand being greatest within equity and currency markets. DeskTrading suggests that SMAs are beginning to solidify themselves as an attractive alternative to mutual funds for retail investors and traders, offering increased control over how their portfolios are managed.
Between 2010 and 2017, an 85% global growth in SMAs was confirmed, with demand growth between 2017 and 2020 in the retail FX market standing at around 20% per annum. This demand has been witnessed most notably by emerging managers operating with assets under management beneath the $1 billion threshold; a change that is understood to be the direct result of both investors and traders seeking to maximize control over their portfolio and enjoy the same level of personalized money management that was once available only to corporations and institutions.
Steve Wong, Head of Trading at DeskTrading stated that “Separately Managed Accounts certainly aren’t new, but over the last few years we’ve noticed a strong renewed interest in this form of portfolio management, especially within equity and currency markets. Investors are beginning to diversify, and separately managed accounts are providing traders with both the transparency and the control they need in every step of the process, and this puts them in the driving seat more than ever before”.
FX SMAs deliver a number of benefits for investors and traders, including increased transparency, greater financial flexibility, real-time professional oversight by an experienced management team, and fully customised portfolio management; a benefit that cannot be experienced through pooled investment vehicles.
Alternatives on the whole have significantly increased in popularity over the past few years, and it is now estimated that more than half of all new hedge fund assets are deployed using non-traditional vehicles, such as Separately Managed Accounts. It is widely anticipated that the renewed interest in SMAs that has been reported by DeskTrading will continue to grow as more and more investors realize the benefits.
