In fact, tax-exempt assets could make up 40% of the assets under management in that industry by 2011, up from 35% today according to a new study of the managed-account industry by Financial Research Corp. (FRC), a financial-services research group.
And that increasing share will come from a growing product segment. The amount of assets held in separately managed accounts is expected to more than double by 2005 and triple six years after that.
Managed accounts are individual accounts offered by financial consultants utilizing a range of advisory services. They are usually managed by professional, independent money managers using an asset-based fee structure, according to FRC.
According to FRC projections, separately managed account
assets are expected to grow from about $415 billion at
year-end 2001 to nearly $1 billion by 2005. By 2011, FRC
said the industry could have nearly $3 trillion under
management. New asset flows in managed accounts will
increase from $103.7 billion this year, to $231.9 billion
in 2005 and $469.4 billion in 2011.