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Sterling – Extreme Makeover. ..the right investment decision. Why Was Sterling Created ?. Enable you to provide boutique professional managed direct investment portfolios to clients but without the administration or ongoing advice burden
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Sterling – Extreme Makeover ..the right investment decision
Why Was Sterling Created ? • Enable you to provide boutique professional managed direct investment portfolios to clients but without the administration or ongoing advice burden • Enable you to use the same approach as that used by leading private client firms and family offices - you can compete against every other adviser and maintain your relevance to the client relationship • FoFA and the “new world” of advice • Potential for lower cost to client without compromising margins to Futuro or the adviser
Recap on Sterling • An Investment Management business created to deliver investment solutions for the “new world” • Launched Managed Account Service in mid 2010 and a Super Solution in late 2010 • A range of Investment Options made available across the asset classes • Fee structure in line with wrap • Online functionality and reporting through a Sterling branded website
Sterling Responds to Retail Client Requirements • Cost – demand for an end to end reduction in cost • Transparency – requirement to be able to know what is going on within their portfolio • After tax outcome – for both income and capital • Ownership – greater sense of ownership created by direct investments
Where Are We At ? $55m in Sterling as at 15 October One practice with significant FUM, should be more ! Why ?
What Has Been Done ? Significant rework of Sterling in conjunction with IAS Extended range of Investment Options after significant effort in identifying, meeting and assessing suitable managers to manage the Diversified Options Replacement of some managers after identifying, meeting and assessing suitable managers Revised pricing - some of the Options are the sharpest in the market
What Has Been Done ? Revised pricing - some of the Investment Options are the sharpest in the market, particularly in the Managed Account Service Upgrade and replacement of Managed Account Service documents near complete Upgrade and replace Super documents
Key Mandated Manager Changes Joseph Palmer and Sons to manage a range of Diversified Portfolios AE Growth – Bennelong replaced by Joseph Palmer and Sons Diversified FI – RIMSEC replaced by Realm Investment House (Joseph Palmer and Sons interim) Sterling to manage an extended range of Investment Options, particularly focused on managed funds
Sterling Managed Account Pricing Replacement of Administration Fee and Investment Management Fee with one Portfolio Management Fee approach Note: Portfolio Management Fee includes all administration, mandated manager fees and Sterling fee but excludes any MERs MERs will vary according to the Funds used in themodel in which a client is invested Fees are plus 5% GST not 10% GST due to IAS GSTPrivate Ruling
Sterling Managed Account Pricing Comparison of the Sterling Balanced Portfolio against managed funds on a wrap for a $250k client A saving of $1,000 – can you afford not to pass this onto your clients ? Or an opportunity to increase your own fee ?
Sterling Managed Account Pricing For any listed securities, brokerage will vary depending on manager Diversified Portfolios and AE Growth will incur 4bp brokerage – lowest in the market Transaction fee for any purchase or sales is $10 So a $10,000 trade for the Diversified Portfolio or AE Growth will cost $14
Sterling Super Pricing Management Fee covers Investment Administration, Super Administration, Promoter, Distributor and Trustee Fee Investment Management Fee in line with the Managed Account but without the benefit of RITC discount MERs will vary according to the Funds used in themodel in which a client is invested
Sterling Super Pricing Comparison of the Sterling Super Balanced Portfolio against current Super options for a $250k client A better outcome for the client
Sterling Super Pricing For any listed securities, brokerage will vary depending on manager Diversified Portfolios and AE Growth will incur 4bp brokerage – lowest in the market Transaction fee for any purchase or sales is $10 So a $10,000 trade for the Diversified Portfolio or AE Growth will cost $14
Looking to Use Sterling as an Investment Solution for SMSFs Super administration integration – Class Super Flexible Portfolio design – pension version of Diversified Portfolios to maximum benefits to zero tax payers GST Private Ruling removes the requirement to register for GST Potential to reduce costs – RITC for investment management fees incurred and reduced audit costs through GS007
Adviser Assistance Education – managed accounts, business models and Sterling through Futuro Practice Development Managers and IAS Business Development Team Practice take on kit including Transition Guide , client flyers and adviser flyers Investment into Sterling requires advice to clients by the adviser – SoA template Transition from existing administration arrangement to Sterling - Adviser support from various sources (1800 and email) and IAS Transition team
Mandated Manager Interaction Monthly webinars Regular Portfolio Updates – market commentary, portfolio commentary, specific investment updates for major contributors and detractors from the portfolio Adhoc Market Updates where required – specific issues in the market Portfolio implementation interaction – where an existing portfolio is migrated into Sterling Adhoc adviser requires – within reason
Summary Sterling provides you with a real opportunity to change your approach to client investments and the efficiency and profitability of your practice Sterling supports any practice business model Sterling is competitively priced across both the Managed Account and Super solutions Sterling enables you to deliver a different value proposition to your clients
Sterling has changed Over to you !
