Help your clients invest to grow

5 min read

There are many ways an investor can grow their wealth. Delegate the day-to-day investment decisions and implementation of your chosen investment strategy to professional investment managers. Depending on a client’s objective, time horizon, and risk appetite, they can choose to invest in any of the four mainstream investment classes. However, growth assets such as equities have tended to generate higher returns and higher capital growth over the long run than cash and fixed interest investments. During the 20-year period to December 2013, despite many major setbacks, including the Global Financial Crisis of 2008, Australian equities produced an annualised return of 9.10% while the ‘safer’ asset class of Australian cash produced the lowest return of 5.5%.

Overview

The historical performance of growth assets can be a reasonable indicator of what is going to perform well for your client over the long term. Looking at the last two decades, international and Australian equities outperformed all other major asset classes. The chart below shows the growth of $1000 invested since January 1993 in cash, Australian bonds, Australian listed property, Australian and international shares.

Invest to grow using a Managed Account

When investing in equities, your client may want to consider the benefits of managed accounts versus managed funds. With a managed account, your client can retain the beneficial ownership of the underlying securities (as opposed to a managed fund). They also have the ability to delegate the day-to-day investment decisions to professional investment managers.

Separately Managed Accounts (SMAs) and Individually Managed Accounts (IMAs) both offer clients a professionally managed direct share portfolio, but IMAs offer individualised attention for each investor’s unique needs.

  • Separately Managed Account (SMA): An SMA uses a model portfolio basis. Investment decisions are made in line with a specific investment mandate, around a common objective for all investors.
  • Individually Managed Account (IMA): An IMA can be tailored to the individual’s unique circumstances, such as implementing stock or sector restrictions to suit a client. This added flexibility requires a portfolio manager to execute individual trades on the client’s behalf.

Who is this strategy for?

An invest-to-grow strategy is suitable for a wide range of investors ranging from starters, to sophisticated investors, to SMSFs. The strategy involves the use of a Managed Account, which might appeal to clients looking for transparency, professional management and tax effectiveness. With regards to an IMA, the additional cost of running one often means that a higher initial investment is required (when compared to an SMA), and will therefore suit clients with a larger investment to make.

Features and benefits of using a BT Managed Account

Clear and concise reports

Comprehensive administration and consolidated reporting makes it easy to follow what your client’s portfolio is doing.

Beneficial ownership of listed securities

Clients can see the shares purchased on their behalf and receive the potential benefits of income, dividends, franking credits and potential capital growth from direct ownership.

Access to expert investment professionals

Get access to professional fund managers who undertake extensive research to create model portfolios. Models are constructed and dynamically managed based on established valuation principles.

Professional portfolio management based on investment needs

The team of specialists and portfolio managers will work with you to structure a diversified, tax effective investment portfolio based on the chosen investment strategy.

Around the clock access

Clients have access to their portfolio details online 24/7 to check the performance valuations, trading activity and more.

Possible options for BT Managed Accounts

  • BT Elect Portfolio SMA

Invest a minimum of $50,000 in an investment solution designed to provide direct exposure to a professionally managed portfolio of Australian listed securities and property.

  • BT Aspire Portfolio IMA

Invest a minimum of $500,000 in a specialised investment management service designed to provide direct exposure to a professionally managed portfolio of Australian listed securities and access to other asset classes.

  • BT Private Portfolio IMA

Invest a minimum of $1 million in a bespoke investment solution designed to provide an individualised portfolio management service implementing the investment strategy that you determine for your Clients.

Our Business Development Managers are here to help
Investment strategies 30 Nov 2018
Clients who are currently using geared investments, or who are interested in them, could benefit from a borrow to grow strategy. BT offers a number of loan options to service this strategy such as a BT Margin Loan or Westpac Installment Warrants.
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Investment strategies 27 Apr 2018
All investors want to grow their capital, but the high growth associated with investing in equities is accompanied by increased risk exposure. The protect-to-grow strategy uses a Protected Equity Loan (PEL) to leverage the growth potential, with some potential tax benefits, while providing capital protection at a point in time (eg at maturity of the investment loan).
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SMSF Strategies 27 Apr 2018
This guide outlines some of the ways you might benefit from an SMSF but also some of the key things you need to consider before establishing one and moving your benefits over to it.
PDF 1,400 MB