Liz Koh: Model portfolios “inevitable”

Liz Koh, the founder of Moneymax and the director of Enrich Retirement has told Good Returns that model portfolios are an “inevitable” industry shift.

“Advisers don’t really add a lot of value in terms of portfolio construction. That side of things is best left to the technical experts who can focus on asset allocation, stock selection and that sort of thing.”

Koh went on to say that by leaving the technical aspects of portfolio construction to a model portfolio system allows the adviser to focus on the customer facing aspects of their roles. Advisers will understand their clients' goals, then be able to access a range of model portfolios so that they can best align with their client’s long-term strategy.

The model portfolio system is not just recommended by Koh to individual advisers, but to have the potential to change the shape of the industry as a whole, “It simplifies everything from an administrative point of view. It’s also much more cost-effective to have model portfolios than customised portfolios. It cuts down the paperwork. Takes away the risk for the adviser to make bad choices for their client.”