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What Is an Investment Platform and What Does It Do?

22 March 2023

Investing via an investment platform offers many advantages – the main ones being ease of use and saving time on admin. Keen to know more? Read on…

“You can think of an investment platform as a hub or shopping mall where retail investors are given access to a variety of asset managers and their funds, effectively functioning as a one-stop shop for their investment needs,” explains Elton James, Head of Corporate Business at Glacier by Sanlam.

How does an investment platform work?

By providing access to a wide range of both local and international funds from different managers in one place, investment platforms make investing easier and remove a lot of the admin. Together with your financial adviser, you can combine and invest these funds into different solutions on the platform – such as a discretionary investment plan, retirement annuity or an endowment – to create a diversified investment portfolio. The investment platform, therefore, caters to your investment needs across your lifetime. Whether you’re in the wealth accumulation phase or want to draw an income in retirement, the investment platform has the solution for you.

We perform a due diligence check on all the funds that we host on our platform before making them available for investment. As the administrator, we ensure the necessary compliance, risk management and reporting procedures are in place, so investors can invest with certainty, efficiency and confidence. We also provide financial advisers with information and online tools to help free up more of their time to spend advising you, the investor.

Important to note is that the investment platform does not manage the money on behalf of investors. “We are the custodians of the assets; however, the asset manager remains the manager of the assets and is responsible for the investment performance of the funds. The performance of your investment vehicle – whether a retirement annuity or endowment – will ultimately depend on the performance of the underlying funds included in your investment,” says James.

Platform vs direct investing

The advantage of using an investment platform is that it makes the investible universe accessible and efficient for an investor. “By having choice and flexibility, an investor can build a portfolio of different funds, ETFs, a share portfolio, etc. within the correct product solution. Plus, platforms have preferential fund pricing as opposed to the direct offering – effectively, the administration premium,” says James.

Using an investment platform through an adviser reduces time and admin. “Pure direct investing, assuming you are building a diversified portfolio, would require an investor to co-ordinate their portfolio across multiple access points, record returns and unit price movements from the various access points, and communicate with multiple points when rebalancing or switching within the portfolio,” explains James. “We also provide multiple reporting functionality along with regular statements, tax provisions and certificates, and 24/7 accessibility online.”

How Glacier’s investment platform addresses changing needs

People’s circumstances change, as does the investment environment.

“Glacier’s offering covers the risk spectrum from the most conservative options, for example, guaranteed return investments, to solutions for those willing to take on more risk, such as share portfolios. Within these, the investment platform also offers pre- and post-retirement solutions. This is leveraged by the extensive range of investment options available, allowing an investor to make changes within their solutions to match their needs, and on their financial journey as they move between solutions, without ever leaving the market,” says James.

A wide investment universe

“As an investor, you need the peace of mind that your adviser has access to a wide range of funds as well as investment vehicles, and also to online resources. This way you have peace of mind knowing that the solution put forward is the best suited to your individual needs,” says James.

View the infographic to learn more.

This article first appeared on Glacier Insights.

Glacier Financial Solutions (Pty) Ltd is a licensed financial services provider.

Sanlam Life Insurance Limited is a Licensed Life Insurer, Financial Services and Registered Credit Provider (NCRCP43).
Sanlam Life Insurance is a licensed financial service provider.
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