Separately managed accounts (SMAs) seemed so revolutionary not too long ago. They were supremely marketable, with the tax lot advantages, and garnered a lot of assets. But they are no longer hailed as the next big thing. In fact, they are in the doldrums.

Traditional SMAs grew 6 percent from mid-2009 to mid-2010, now accounting for 28 percent of all managed solutions assets, according to the Money Management Institute. SMA assets as of the middle of the year were 35 percent lower than their 2007 peak. To be sure, the equity carnage was not kind to these accounts. But the broader universe of managed solutions is faring much better.

Financial Planning notes that unified managed accounts (UMAs) have seized some momentum. From mid-2009 to mid-2010, UMA assets grew 73 percent. They now account for 16 percent of managed solutions assets. These accounts can be seen as the logical evolution of SMAs; they preserve and enhance some of the tax lot, reporting and customization benefits, but they also add different asset classes and in some cases make it unnecessary for advisors to screen any investment managers.

The future may well be the unified household management account, which will allow accounts to incorporate retirement accounts and other investments to help provide detailed financial planning services. The bottom line is that all advisors have to deliver the added value that clients expect. Some of them may want their advisors to screen funds and the like. In any case, there are many managed solution options available.

For more:
- here's the Financial Planning article

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