Investec Wealth & Investment (W&I) has been named as both the most popular and most preferred discretionary fund manager by advisers, up from fourth place last year, according to Defaqto.
The firm conducted its second annual DFM review and surveyed 137 advisers for the report.
The most popular DFM was Investec W&I which was used by more than 25% of wealth managers in 2016. This is up from just over 10% on the previous year.
In second and third place were Brewin Dolphin and Quilter Cheviot at 24% and 23% respectively.
The report, written by Defaqto insight analyst - funds and DFM Fraser Donaldson, also found a quarter of business placed is done on an advisory basis and and two-thirds of this is done via multi-asset managed funds.
For those using a model portfolio service (MPS) some 19% do so by going direct to the discretionary manager, slightly lower than the previous year, while more are using platforms to access an MPS 29% in 2016, compared to 18% in 2015.
Investec W&I also topped the charts of preferred DFMS, where advisers indicated which firms are giving the highest satisfaction in terms of customer service.
Just over 20% chose Investec DFM for bespoke services, up from 10% a year ago, and this was again followed by Brooks Macdonald at 13% and Quilter Cheviot at 10%. However, Quilter Cheviot, Brewin Dolphin and Vestra Wealth all saw a decline in user preference from last year.
The report said: "Those firms that seem to have been establishing themselves in the adviser market have consolidated and improved their position. It will be interesting to see next year if this trend continues.
"If it does, it is suggesting that gaining a foothold in the adviser market for bespoke services is going to be very difficult for new entrants."
Looking at model portfolio services rather than bespoke, the preferred DFMs were Parmenion, Brooks Macdonald, Quilter Cheviot and TAM Asset Management.
"Solutions appear to be selected on their own merit. In other words, if a bespoke service is chosen from one firm, it does not necessarily follow the MPS will also be chosen from the same firm."
The most important factors for advisers when selecting a DFM were quality of investment staff and service, unchanged from last year. Least important were brand and accessibility.
The firms best at meeting these criteria, as ranked by respondents, were Brooks Macdonald, Investec Wealth & Investment, Parmenion, Quilter Cheviot and Rathbone Investment Management.
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