Yeh you're right Timber. Was definitely only referring to the infancy in Hub24's FUM - couldnt agree more re its development - its an industry leader in my opinion particularly on the SMA capabilities.
That $50m development cost figure that I mentioned - That was the answer I received after I put that question 6 months ago to the co-founder and CEO of a successful platform developed around 2000/2001 (and still in use today - owned now by a large institution).
I assume this figure included costs associated with establishing distribution.
SMA's
You have advisers that have been wanting to offer their clients the transparency or sexiness of a direct share portfolio rather than just utilising managed funds - but for good reasons, dont want to be in a position where they are responsible for the creation and ongoing management/research of direct share portfolios for their clients.
But they still want to compete with the sizzle of the stockbroker down the road, and want to say to their clients 'You currently have 400 shares in BHP, and we expect you'll receive their dividend on XYZ date'
On the other hand, you have a bunch of forward thinking stockbrokers in the country who are figuring out that they can create their own specialised SMA portfolios built on the back of their inhouse research and charge a management fee/performance fee and/or dial up the brokerage on any trades. There's no need to call up the client first, sell them on why they should take their advice to sell/buy the stock, there's no need for RoA's and for the client they receive timely and efficient advice on their portfolio.
Why would you want to do the traditional stockbroking model - its too cumbersome, hard and inefficient for the client. Time would be better spent on developing their own model portfolios and getting out and marketing the crap out of it.
When Hub24 was first built, it was probably about 5 years ahead of its time for the Australian managed account market. Eventually advisers and brokers will figure it out. Some already have.
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