J.P. Morgan Asset Management joins OpenInvest marketplace
OpenInvest today announces that J.P. Morgan Asset Management, a leading global asset manager, has joined its digital marketplace, giving Australia’s retail investors access to its multi-asset class, diversified portfolios.
J.P. Morgan Asset Management joins BlackRock and Schroders on the digital marketplace, which enables self-directed investors to access professionally managed investment portfolios in an open, transparent and content-rich environment.
The OpenInvest online marketplace allows investors to get to know, at their own pace, the different investment approaches of the asset managers, empowering them to choose one to manage an investment portfolio on their behalf. Once an investor chooses their preferred asset manager, they will also receive regular explanations from their manager as to the reasons behind portfolio changes, and how the asset manager is thinking about a range of important investment-related issues.
Andrew Creber, Australia and New Zealand CEO of J.P. Morgan Asset Management, said the company is excited to be joining OpenInvest to help meet retail investors’ rapidly growing demand for digital investment solutions.
“Australians historically tend to put their savings into property and a few well-known stocks but retail investors are increasingly looking for professionally managed and cost-effective ways of accessing diversified investment portfolios. Partnering with OpenInvest to provide enhanced digital capabilities and tailored solutions is one of the many ways that we aim to reshape how we interact with and add value to our clients.”
“There are many Australians who would like to access professional investment assistance but find it too costly to obtain personal financial advice. OpenInvest’s technology will enable us to more readily help these retail consumers access our funds management expertise.”
Co-Founder and CEO of OpenInvest, Andrew Varlamos, said that bringing the global expertise of some of the world’s largest asset managers within easy reach of Australia’s retail investors was true “democratising” of investing.
“The past two years has seen an extraordinary increase in Australia and elsewhere in people taking up online share, CFD and crypto trading, in some cases attracted by relentless online marketing campaigns proclaiming that investing is fun and easy – often referred to as the “Robinhood effect”. That’s not our idea of democratising investing – we believe it means giving all Australians access to the world’s most well-resourced, experienced and trusted asset managers. Or as I put it: Yes, it’s never been easier or cheaper to trade. Yet, it’s never been more difficult to know what to buy or when to sell, in order to have a proper, diversified investment portfolio.”
Varlamos acknowledges that OpenInvest won’t be for every investor, adding, “We’re not a trading platform for those who like to swap tips on online message boards, or who buy a stock because it’s trending today, or want to copy some anonymous amateur trader who’s had a lucky few months. We have designed OpenInvest for those who understand that investing and trading are two completely different things: that investing is a serious business, and requires diligence, education, resources and relentless dedication. That’s what our participating asset managers have, and they are happy to share that with investors of all sizes.”
Varlamos pointed to Australia’s SMSF sector as being particularly open to accessing professional investment management expertise.
“SMSF trustees consistently tell researchers that one of the most difficult aspects of operating their SMSF is knowing how to manage diversification of the fund’s portfolio. Latest data from the 2021 Investment Trends SMSF Investor Report shows that the number of SMSFs using a financial planner has declined, and that the number of unadvised SMSFs with unmet needs has increased to 245,000. We think SMSFs will value the comfort and reassurance that comes with having a world-class asset manager in their corner.”
Founder and Managing Director of the country’s largest provider of SMSF administration software, Ron Lesh of BGL Corporate Solutions (also an early investor in OpenInvest), echoed Varlamos’s comments, “Our software is used by 7,000+ firms to administer 230,000+ SMSFs. We know the key issues they’re focused on. For a variety of reasons, but particularly due to the sustained low interest rate environment, it’s extremely challenging for self-directed SMSFs to feel confident they have got their investment strategy right. We welcome the OpenInvest initiative, bringing the expertise of world-class asset managers to SMSF trustees.”
How the OpenInvest marketplace works
OpenInvest has been designed to facilitate the initial connection between investors and asset managers, and then to underpin their relationship.
“Investors can get to know the different asset managers – who they are, how they’re currently investing, what’s keeping them up at night, how much their portfolios cost – so they feel confident and empowered to choose one to assist them,” Varlamos explained.
After the investor chooses a model portfolio from their preferred asset manager, OpenInvest continues to provide the support structure and online access – including a dedicated investor portal and an app – handling all of the trading, reporting and administration, whilst charging zero ASX brokerage fees.
OpenInvest is in discussions with other tier one asset managers wishing to join the marketplace in the months ahead.