Proactive Portfolios

Following feedback received from advisers of Madison Financial Group and subsequent market analysis, PHAROS has identified a market shift that is emerging from managed fund-type investment solutions, to managed account-type solutions including IMAs and SMAs.  This shift seems to be due to a combination of the assets being held directly in the client's name, their greater transparency (fees, holdings etc.) and the capacity for clients to more effectively arbitrage the tax consequences of their fund's investment holdings.

For clarity Managed Accounts differ from managed funds due to the investment holdings being held in the client's own name or their entity's name.  Investment management of the account can be performed by the client, their adviser or outsourced to a professional investment program manager.  Managed accounts can be incorporated into investment platforms such as Wrap Accounts and Unified Managed Accounts wherein integrated reporting can be delivered with respect tax, assets holdings and performance etc.

PHAROS has further determined that two forms of Managed Accounts are being sought by advisers and clients - limited asset class accounts and diversified asset class accounts.  Whilst there are numerous highly reputable program managers operating in the 'Limited' space, far fewer seem to exist in the 'Diversified' space.  For this reason PHAROS has embarked on developing a range of Diversified Asset Class Accounts that will be managed in alignment with 3 inital client risk profiles - Balanced, Growth and High Growth.

This new initiative - to be offered via PHAROS's Proactive Portfolios business has secured the one-time founder of Van Eyk - James Purvis, as its Chief Investment Officer and has pre-committed seeding of over $150m.  The accounts will initially only be available on OneVue's Unified Managed Platform due to it being the only platform solution currently available that can deliver the integration and execution being sought from the PHAROS aligned firms.

In summary, PHAROS' subsidiary - Proactive Portfolios will be launching a range of SMAs that will provide:-

• Professional Investment Management that will concurrently manage the two investment drivers - asset allocation and investment selection, to achieve optimised portfolio performance.
• The capacity for clients to directly utilise tax consequences associated with portfolio holdings due to their being directly held in the clients or that of an entity of their choosing.
• Extensive client reporting - asset holding, weighting and changes; end-of-year tax reconciliation; portfolio performance.
• Portfolios that are aligned to specific risk profiles - with asset allocation and asset holdings being managed within stated profile mandates.
• Completely transparent fee structure.
• Clients of the Proactive Portfolios will also be eligible to receive the highly regarded AdviceNet Market Summaries which give investment outlooks that are insightful, usable and based on the conviction of the author(s).