NEW YORK-The separately managed account business will flourish, as many firms that have not previously offered SMAs will decide to do so over the next few years. But while this is likely to boost assets and the number of investors in SMAs, competition will become fierce. That was the message of speakers at The Money Management Institute's Managed Accounts Solutions conference here last week.
Competition is already heating up, as wirehouses, insurance companies and banks are rapidly joining asset management firms to launch SMAs. Fifteen percent of assets under management at wirehouses were in separately managed accounts two years ago. Today that number is close to 22%, with expectations of further growth, said Darlene DeRemer, a partner at merchant bank Grail Partners of New York.