Stock markets rallied in the first quarter of 2019, and with that adviser platforms have returned to asset growth. Based on the latest Platforum market data, adviser platform assets rose by 6.7% in the period to stand just shy of the £500bn mark.
The main story of the quarter has been the large decrease in flows. Across the board, platforms have seen their net inflows fall dramatically from the levels witnessed in 2018. Total net flows are down at just under half of the totals from Q1 2018.
Pension flows still dominate, and have held up better than other wrappers, but even here net flows are down 44%. The loss of the DB transfer tailwind has really made its mark on the adviser platform market.
Typically, the first quarter of the year sees a spike in ISA activity as clients and their advisers look to make use of any remaining ISA allowance at the end of the tax year. However, several platforms again recorded net outflows from ISA wrappers.
Direct platforms are seeing similarly tough times, suggesting that negative investor sentiment is the underlying cause, rather than any regulatory or capacity issues specific to the advice market. Platforms are almost stuck in a holding pattern, until confidence picks up.
Platforum publishes quarterly updates of the adviser platform market and financial adviser sentiment within our UK Adviser Platforms series. We will be publishing our Q1 2019 update next week. Get in touch for more information.