Separately Managed Accounts Forecast to Grow to $2.1 Trillion by 2011

March 31, 2003 ( - Eight years from now, the separately managed account (SMA) industry will boast 12.5 million accounts with $2.1 trillion in assets, a new study predicted.

That was the result of an industry forecast by the Financial Research Corporation for The Money Management Institute (MMI), an SMA industry group. The study also estimated that the SMA industry will grow to 5.3 million accounts and $930 billion in assets by 2006 from the approximately 2.04 million accounts and $398 billion in assets at year-end 2002.

In addition to projecting growth in account and asset levels, MMI and FRC also looked at industry growth by type of firm and sales channel, account asset allocations, and changes in average account sizes.The study indicated that SMA industry year-over-year net sales of SMAs increased by 181% in 2002, to approximately $50 billion compared with approximately $18 billion in 2001.

In 2002, large cap equities represented 57% of new accounts, while balanced accounts represented 17%, fixed income 9%, mid-cap equities 6%, small-cap equities 1%, and other assets 10%.

Managed accounts are individual accounts offered by financial consultants utilizing a range of advisory services and are usually managed by money managers using an asset-based fee structure.