Nucleus and Brooks Macdonald have both seen softer levels of inflows in their latest set of quarterly results as volatility continued to dampen investor sentiment.
Adviser investment platform Nucleus, which listed on the Aim index in July, recorded £282m ($361.7m, €317.2m) of positive net flows in Q3 18, down 10% from the £315m net flows it posted in the previous quarter. Compared with the first quarter (£411m), net flows were nearly a third lower.
Fellow Aim-listed firm Brooks Macdonald was also impacted by softer client sentiment during the quarter.
Net flows in the three months to 30 September 2018, the first quarter of its financial year, dropped by over 25% to £158m from £214m the quarter before.
Positive performance related movements, which drove asset growth in the previous quarter, dropped by two thirds from £542m to £211m.
Nucleus assets circling £15bn
Weaker investor appetite did not stymie growth in assets under administration at Nucleus which rose from £14.3bn to £14.7bn. Total assets were up 8.1% year-to-date and 14% compared with the previous year.
The platform saw total inflows of £563m in the third quarter, which were lower than the £600m in subscriptions it took in the quarter before. This was also a noticeable step down from last year’s £687m inflows, an all-time high for the group.
However outflows of £280m were down slightly from the £285m in redemptions it saw in Q2 18.
Nucleus founder and chief executive David Ferguson said the platform provider had continued to see a “solid increase” in adviser and customer numbers despite market jitters.
Adviser and customer numbers have risen 5.6% and 4.3% respectively since the start of the year. The number of advisers actively using the platform was 1,391 at the end of the period.
“Of course, it is in exactly these market circumstances that the need for financial advice is at its most pronounced and we believe the soundness of our business model, our financial health and the ongoing investment we are making in our proposition position us well both now and in the future,” said Ferguson.
UK growth halves at Brooks
Brooks Macdonald chief executive Caroline Connellan was keen to highlight the group’s continued growth in the UK.
“We have maintained positive momentum in our UK business over the first quarter, with good organic growth despite softer client sentiment in light of the current macroeconomic environment,” she said in the firm’s results.
The group’s UK investment arm saw organic growth of 2% during the period which was in line with the previous quarter’s 2.1%. But total growth in this segment halved from 6.8% to 3.6% as performance related movements contributed two thirds less to asset growth. Net new business was down marginally from £217m to £211m.
Its Channel Islands-facing investment business, BMI, suffered net outflows of £52m, following the departure of one of its key client-facing teams in the region. Its international business saw assets fall 1.1% to £1.7bn.
Total funds under management at the group grew 3% from £12.4bn in the previous quarter to £12.8bn by 30 September 2018. This figure was 16.4% higher year on year.
Last week Brooks Macdonald debuted its sustainable investment team which will oversee two strategies, an exclusionary approach to sin sectors and a sustainability-focused solution.
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