Hobson Wealth Partners plans to revisit its investment platform settings within three to six months.
Warren Couillault, Hobson executive director, said the group’s tentative agreement to shift from current provider, Aegis, to the NZX Wealth Technologies (NZXWT) was put on hold as the wealth management firm developed a new in-house securities trading capability.
In 2016, the-then Macquarie NZ private wealth business struck a deal to shift its assets under management (of reportedly up to $3 billion) from Aegis to the NZX platform. After a management buyout later that year – led by Couillault – Macquarie NZ took on the Hobson Wealth brand.
“Part of the [NZXWT] plan included a trading platform, which we decided to build ourselves,” Couillault said. “In the meantime we have parked our custody arrangements with our existing provider [Aegis]. But we’ll have another look at that in the next three to six months.”
In the meantime, he said Hobson was busy fitting out its new NZX-listed securities trading desk with a few key appointments due to be revealed this week.
Couillault said the private wealth management group had been reviewing its trading options for some time.
Hobson inherited Macquarie’s incumbent third-party trading partner, ANZ Securities, which was sold to FNZC last November.
“We had decided to in-house trading before the sale,” he said. “But the fact [ANZ Securities] was sold to a competitor made our thought processes more robust.”
Hobson has appointed BNP Paribas Securities Services as custodian for the new trading platform.
While the Hobson move goes against the general outsourcing trend, Couillault said the group viewed trading as a “core function”.
“Buying and selling securities on behalf of our private wealth clients gives us greater control and the ability to add value,” he said.
The move would also see ongoing trading costs reduce compared to previous third-party arrangements, Couillault said, with the potential to fall further as Hobson builds scale.
“We have some fixed costs in setting up [the trading desk] but as we get bigger we can execute more cheaply.”
He said Hobson planned to open its trading desk to other firms over the “next six to nine months”.
“Customers like to have choice of supply but the broker market has been shrinking in NZ,” Couillault said. “We’re proud to be bringing some supply back to the market.”
The “specialist private wealth” firm would look to bring other functions in-house, too, he said.
For instance, Hobson has hired a new analyst to beef-up its in-house research capability.
“Now we buy a lot of research from third-parties – including Macquarie – but we plan to do more ourselves,” Couillault said.