Groundbreaking managed account focused on private markets launches on BT Panorama

BT has launched the Drummond Private Markets Separately Managed Account (SMA) – the first managed account on the BT Panorama platform that is dedicated to private markets. Innovatively structured, the SMA gives high-net-worth (HNW) clients easier access to a mix of private equity, private debt and real assets.

Zac Leman, Head of Managed Accounts, BT, said: “Many high-net-worth clients are interested in gaining exposure to private markets, to add to their existing portfolios which are predominantly invested in traditional asset classes. Drummond’s new product caters to that client demand, while also giving advisers the benefits that come from utilising a managed account structure.”

Tom Schubert, Managing Partner of Drummond Capital Partners, said: “Our managed account solution addresses many of the hurdles that advisers and clients tend to face when investing in the private market sector – accessibility, liquidity, complexity and transparency.

“We’re proud to have developed an innovative, differentiated solution that has been the culmination of our investment team’s experience in the managed account sector and strong heritage in the high-net-worth and family office segment. We have chosen to launch this first on BT Panorama because of the mix of investors on the platform – which includes a sizeable high-net-worth segment – and the BT team’s managed account capabilities.”

Private market investments have been traditionally the reserve of the ultra-HNW, with existing private equity or venture capital funds typically setting minimum investment thresholds in the $5m-$10m range.

In comparison, the minimum investment in the Drummond managed account is $100,000, making the product accessible to clients who are classified as sophisticated investors (defined as having minimum net assets of $2.5m or a minimum income of $250,000 per year for the past two years).

Investors also benefit from the product’s managed account structure which offers professional management, diversification and transparency of underlying investments across private markets asset classes.

Drummond selects and manages a portfolio of private markets managers with a focus on liquidity management. The portfolio provides access to funds with the majority allowing monthly redemptions; some have daily or quarterly redemptions. In comparison, some private markets funds typically require a long-term commitment, with investors’ funds “locked up” or inaccessible for around 10 years.

Investor interest in private markets has grown recently, as the number of Australian HNWs has continued to climb, and information about the sector has proliferated due to opportunities arising from technological disruptions and emerging markets. Further, the number of companies delisting from the Australian Stock Exchange and privatising has increased. ¹

Funds allocated to alternative assets have been increasing, and around 17% of HNW investors in Australia are utilising alternative assets.²

Drummond Capital Partners developed their new SMA in collaboration with Ironbark Asset Management.

Alex Donald, CEO, Ironbark Investment Solutions, said: “We are delighted to have been chosen by Drummond as the responsible entity for this new managed portfolio solution. We look forward to collaborating closely with Drummond and BT now, and in the future, on this expanding asset class.”

Managed accounts growth on BT Panorama

BT’s managed accounts offering has grown to a total of over 400 products, with funds under administration increasing by 31% to $16bn in the 12 months to 30 April 2024 (excluding Adviser and Tailored Portfolios). 

1. In July 2023 to February 2024 there were 110 delistings from the ASX compared to 75 delistings in the previous corresponding period; and only 38 new companies were admitted, compared to 47 in the previous period. ASX Group Monthly Activity Report, February 2024. 
2. CoreData Investor Research 2023, published in ‘Alternative Assets: Research Insights’, Praemium / CoreData.