Outlook
The evolution of tailored MPS solutions
27 Mar 25 5 min read
Elevating adviser-client relationships with tailored MPS solutions
Just as a tailor crafts a suit to fit perfectly, tailored model portfolio services (MPS) are designed to meet the unique needs of each client.
In the dynamic world of financial services, MPS have become indispensable for advisers. As demand grows, so does the variety of options from ESG-themed investments to a blend of active and passive styles. However, the true innovation lies in tailored MPS solutions, allowing advisers to customise standard offerings to fit their clients like a bespoke suit.
Understanding tailored MPS solutions
- White labeling: Advisers can use standard models on their chosen platforms, with the DFM providing branded materials. This approach allows advisers to maintain their brand identity while leveraging existing models.
- ‘Own line’: The DFM creates a separate line of standard models on selected platforms, carrying the adviser’s name and potentially offering different pricing arrangements. This solution provides a personalised touch and can enhance client trust as well as making it easier to adopt a custom mandate in the future
- Custom mandate: Advisers and DFMs collaborate to set specific parameters for model portfolios. This could include asset allocation, OCF caps, or a mix of active and passive funds. This bespoke approach ensures the investment strategy aligns perfectly with the adviser’s philosophy.
- Sub-managed mandate: Adviser firms with discretionary permissions can outsource portfolio management to a third-party DFM. This allows advisers to offer tailored solutions without the burden of direct management.
The drivers behind tailored solutions
Regulatory changes, particularly consumer duty, have prompted advisers to re-evaluate their business models. This introspection often reveals the need for customised investment solutions.
Additionally, the commercial landscape is shifting. Some firms focus on cost efficiency, others on brand enhancement, and some on increasing profitability. Tailored solutions like white labeling and own-line options help firms enhance brand visibility and leverage scale for better pricing.
The benefits of tailored MPS
Tailored MPS solutions offer several key advantages:
- Aligned investment approach: Rather than ‘best match’, your own MPS range can be exactly fitted to your advice process, client segments and investment ethos.
- Brand enhancement: Extended brand visibility through white labelling and own-line solutions.
- Cost efficiency: Custom mandates can include cost caps, reducing client costs and adviser fee pressures.
- Revenue generation: Custom mandates can create revenue streams through co-manufacturing fees, enhancing business value.
- Flexibility: Advisers with DFM permissions can outsource management, reducing costs and risks while accessing greater resources.
To find out more about the suitability of MPS for your client, please contact your M&G MPS business development manager.
Partnering for success
We offer a range of tailored solutions, leveraging our experience and expertise across the whole spectrum. We understand tailored solutions are more than just investments but also a matter of managing change for clients, advisers and their wider businesses. Find out more.
Each type of Tailored MPS has its own nuance, pros and cons. Just as a tailor needs the finest materials and skilled hands to create a perfect suit, executing tailored MPS solutions requires a credible partner. I use ‘partner’ intentionally as this relationship should be more than a simple commercial transaction – your clients, brand and business are all involved in the journey.
Ready to enhance your client relationships and optimise your investment strategies?
Contact your M&G MPS business development manager or complete the form below to explore tailored MPS solutions.
This service is provided by M&G Wealth Investments LLP.