Asset accessibility may drive demand, but how does that help an adviser run their business?

  • 12.Feb.2018
  • Shannon Bernasconi,  WealthO2

The following article is contributed content from WealthO2

As innovation makes existing products or services suddenly easier to access, we often see changes in the market.

Ease of availability drives increased awareness and demand, creating a virtuous self-sustaining circle supporting consistent growth. The question for advisers, especially those managing direct or model portfolio’s, is how to easily access the diversification of assets, whilst increasing the practice efficiency, scale and margins, and provide accurate and consolidated reporting to their clients?

Remember Blockbuster?

At its peak, Blockbuster Videos had 9,000 stores spread out over nine countries. Today, they have all but vanished thanks to Netflix, Stan and the like. The arrival of in-home on-demand streaming content completely changed the home entertainment market, just as iTunes and Spotify changed the music market by bringing music straight to the listener’s ears.

In financial services there are examples of new innovations creating and shifting the market.

First let’s talk about bonds

Typically, when some of the greyer-haired among us think of bonds, we think of physical certificates. It was 2012 when legislation finally allowed retail investors to access Commonwealth Government Securities on an exchange, and Australian Government Bonds commenced trading on ASX on 21 May 2013 in the form of CHESS Depository Interests.

Now, with XTBs, the investor has access to the performance and benefits of corporate bonds, which were previously not available directly to the full range of investors.

Another asset class that has traditionally had barriers to entry for retail investors is managed funds. Managed funds have a troubled history around electronic trading in Australia. Trading managed funds through platforms is extremely expensive, and the ASX-backed mFunds solution has seen sluggish uptake and been limited to retail funds with higher MERs.

Next let’s consider superannuation

Super is a successful national scheme, but many Australians, young and old, are not engaged in their super funds due to lack of transparency and control. For the motivated investor seeking transparency and control there are SMSFs, which have seen enthusiastic uptake in recent years. However for many this route is seen as too expensive, or too much trouble, even if that would be the best option for them.

The question for Advisers, especially those managing direct or model portfolio’s, is how to easily access the diversification of assets, provide advice for self-managed and APRA super, whilst increasing the practice efficiency, scale and margins, and provide accurate and consolidated reporting to their clients?


WealthO2 has only one client, the adviser. Using WealthO2’s suite of solutions, advisers can implement direct portfolios for SMSF clients as easily as for a retail super client or Trust/Individual. All listed assets are held “on HIN” in a segregated broker account, and all cash held in the legal owners name at bank. WealthO2 offers the adviser the choice of using managed discretionary accounts or non discretionary, using fully automated, customisable ROA generation, electronic signing and auditable response based execution of the trades. The automation of practice administration tasks, like ROA, reconciliation, consolidation, reporting drive the efficiency and increase the scale and margins for the advisers.

Some advisers are looking to SMAs to drive efficiency, but this comes at a cost. An SMA is really a productised model of assets. WealthO2 offers the adviser the ability to manage that model or engage third party professionals, without that additional layer of cost, and without having to move their clients onto a product based wrap or platform.

WealthO2 launched uXchange to provide financial advisers with simple, low-cost access to managed funds for their clients, while providing an alternative to traditional wrap platforms. As XTBs are easily accessible through a broker, now wholesale managed funds are as easily accessed through uXchange which is seamlessly integrated into our managed account solution. So for those Advisers using mFunds or direct applications for managed funds, alongside direct equities, they now have a single portfolio solution consolidating all the assets and providing trade execution and reporting.

Simplifying Super

WealthO2 launched Super Simplifier last year to offer investors an SMSF-like experience without the cost or the hassle. Working with an adviser, investors can choose a mix of assets perfectly tailored to their superannuation goals. And while all accounts are kept separate, the trustee owns the assets on behalf of the members, securing the assets while keeping administration streamlined and costs low.  Sitting between a super fund and an SMSF, it gives members the personalisation, transparency and flexibility of an SMSF at a cost more comparable to an industry super fund. For pensioner clients under advice, bonds or XTBs via the broker can help to preserve capital, and bond coupon payments offer retirees a predictable income in retirement.

Advisers now have the ability to more easily access assets and manage Investments, SMSF and APRA Super Clients in one automated offering, using the technology to drive scale and increase margins. Using their own or third-party models, they can provide unconflicted access to bonds, XTBs, managed funds, TDs or listed shares transparently and cost effectively.

About WealthO2

WealthO2’s clients are advisers. WealthO2’s technology enables them to establish accounts (eg broker), use strategies and/or models, and using automated ROA or MDA implement / execute the recommendations calculated by the re-balance or order pad. WealthO2 is the oxygen of wealth management, breathing new efficiency and savings into wealth management practices through its clever, intuitive technology. Our team has deep experience in the technical, practical and people needs of wealth businesses in Australia, but most of all we listen. The WealthO2 suite of technology solutions has been developed to address the most pressing needs of Australian financial planning and advice practices, from front office all the way through to back office administration.

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