12 May A cracking start to 2021 for the platform industry
The Line of Duty finale may have been a crashing disappointment, but the platform industry’s Q121 performance was nothing short of brilliant, setting a plethora of new records both collectively and individually. Asset growth was modest at 4.2% or £32.8bn for the quarter, on a par with the FTSE All Share, but it was enough to push the industry into £800bn+ territory. And looking back to Q120 when industry assets nosedived on Covid news, assets are up by a whopping £197bn. Advance by Embark and True Potential were home to particularly strong asset growth, both registering growth of 60%+ for the year.
A rising tide floats most boats
A successful vaccine roll-out (in contrast to the sluggish experience in Europe) boosted investor sentiment and renewed confidence in the UK’s post-Brexit prospects. Pent-up demand was huge — investors had built up a wall of money while waiting for a clearer outlook on Brexit, the pandemic and the US elections.
Timing was a factor. The good news came just before the start of the ISA season, and resonated with investors keen to profit from soaring stock markets. As a result, gross and net sales in the first quarter surged to record highs of £39.7bn (tantalisingly close to the £40bn mark), and £16.4bn — more than double the net sales of the previous quarter.
Platforms with a D2C channel did exceptionally well — both AJ Bell and Fidelity recorded their best gross and net sales through their advised and D2C channels, and flows were almost equally split between the two.
Pure adviser platform business smashed through the £500bn level to £514.5bn and in terms of flows it was also a record-breaking quarter with gross and net sales of £21.5bn and £11.3bn respectively. Standard Life saw gross sales spike to £2.3bn, a rise of c£650m against the previous quarter, keeping it in pole position for gross sales. Meanwhile Transact topped the net sales table with net flows of £1.467bn, with Aviva very close behind and snapping at its heels.
Bella Caridade-Ferreira, CEO of Fundscape said, ‘The industry’s been sucking diesel since November last year. Over the course of the pandemic, investors played safe and stashed their cash. With the positive outlook and confidence in the economy returning, that money is now flooding into investments. It’s been a great start and it looks set to continue for the rest of the year.’
Notes to Editors:
The Platform Report is a confidential report published by Fundscape. To subscribe to the report, platforms must contribute asset and sales data on a quarterly basis. For further information about the report and Fundscape, please visit www.fundscape.co.uk.
A total of 19 platforms are included in the analysis. Platform coverage is estimated at 98% of the platform universe.
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