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REVIEW SUMMARY

Praemium International

Established in Australia in 2001, Praemium is used by financial advisers and investment managers to manage or administer across the globe (almost 1,000 financial institutions and over 500,000 investors).

Praemium provides investment platforms, portfolio administration and CRM solutions. The company has offices in Australia, the UK, Jersey, Dubai, Armenia, Shenzhen and Hong Kong.

Praemium launched its services into the UK market in 2008, where it is now one of the fastest growing discretionary platforms available.

In the UK, the Praemium group is regulated by the Financial Conduct Authority.
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Praemium is a multi-award-winning platform, including the win for International Adviser’s International Platform of the Year in 2018 and 2019. Lang Cat rated them second-highest in its 2020 Platform Market Scorecard (PMS).

Praemium claims to take a different approach to other platforms in terms of what they focus on. While most known platforms are product-centric (e.g. start with client's SIPP and then ask what investments you want in it), Praemium International is portfolio-centric.

They start with the investments you’ve selected and then ask how you want to hold them (giving advisers more freedom). The result is an investment-led platform.

Praemium has different terms on their platform:

  • Model Portfolio Service is called Separately Managed Account by Praemium
  • Bespoke Portfolio is called an Individually Managed Account by Praemium
  • If you wish to hold each type of portfolio for a client simultaneously, Praemium calls it a Unified Managed Account

Praemium’s integrated Managed Accounts platform is said to provide a high level of automation that can help increase accuracy, improve efficiency and lower costs.

Praemium International says that their auto-rebalancing engine eliminates “drift” between investor and model and between investors who are attached to the same model portfolio.

Asset types held by Praemium include:

OEICs (open-ended investment company)/unit trusts on a whole of market basis AIM (Alternative Investment Market) listed equities
Investment trusts on a whole of market basis Corporate bonds
ETFs (Exchange Traded Funds) Government gilts
LSE (London Stock Exchange) listed equities Certain non-sterling and offshore funds
Other ETPs (Exchange Traded Products) UCITS (Undertakings Collective Investment in Transferable Securities)


They also offer structured products, international equities and funds via their offshore platform, Praemium International Ltd.

Praemium's trading is said to be conducted on a compressed trading cycle/matched settlement basis in order to minimise time out of market.

Praemium says that they do not wait for sell trades to settle in order to place buy trades.

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NOTE:

  • All Praemium’s technology is built by them.
  • They accept business from individuals, trusts, joint accounts, charities and corporates. Non-UK residents and USA connected persons are catered for via their offshore platform, Praemium International Ltd.
  • Praemium International services a whole lot of jurisdictions, including Asia, the Middle East, Europe, South Africa and beyond.
  • Domiciled in Jersey, the Praemium International account can be in: GBP, EUR and USD and provides access to a variety of assets.
  • All their accounts offer a wide range of tax wrappers: GIAs, ISAs, SIPPs, QROPS, and Offshore Bonds.
  • Praemium provides an IRS-compliant managed portfolio for US taxpayers. These are provided by specialist discretionary managers.
  • The platform claims to make it easy for advisers to make bulk trades and increase their business operations.
  • Investors have 24/7 access to their holdings at all times via the market leading “Investor Portal”.
  • They can communicate or share documents with their adviser securely through the system.
  • We would highly recommend reading the 'expert verdict' section of this review to make an informed decision.

Additionally, here's a free guide that can help you achieve better results. In this guide, you'll learn:

  • Academic evidence only shared with a select few firms across the world
  • A real-life example of why you should never try to outguess the market
  • Why a fund's past performance is not enough to predict future returns
  • Why you need to focus on what you can control and why this leads to a better investment experience
  • Why you should accept the markets for what they are
  • What can impact behaviour and make people seek instant gratification

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The Pros

> International Platform winner
> Global presence
> Auto-rebalancing
> Accurate tax and performance reporting
> Experienced support team
> Good technology

The Cons

> Not fully open architecture
> Complicated products
> Smartfunds come with risks
> Could be expensive
What does Praemium International's Smartfund dp?

The Praemium International Smartfund  is 80% protected.

If you like more security for your investments, Praemium International offers a capital-protected range.

Praemium says the funds are made up of two parts: the protection component provided by Morgan Stanley, and the risk-graded strategy managed by Smartim.

Both funds are designed to allow you to grow your capital, but the investment journey itself will differ for each of them depending on the market movements.

Investing in Smartfund is said to afford you a slightly better return in the long-term whilst an investment in Smartfund 80% Protected may protect you from the worst of the stock market waves along the way.

It entirely depends on your appetite for risk and current circumstances.

What are the main risks with Praemium's Smartfund range?

An investment in any of the Smartfunds comes with a range of investment risks to consider.

Here's a summary: -

Risk of partial loss of capital, market risk, currency risk and counterparty risk.

• Smartfund 80% Protected - offers 80% capital protection, therefore in extreme market conditions the value of your investment can go down by 20%.

• Morgan Stanley provides the protection component of Smartfund 80% Protected and acts as counterparty to the fund, so if Morgan Stanley becomes insolvent, the protection component may fail.

• The value of each Smartfund may be affected by various market risks including interest rate risk, inflation risk, exchange rate risk and the risk that the strategy managed by Smartim will under-perform its benchmark.

• Fundlogic SAS will seek to hedge the share classes of the funds to counteract the impact of currency fluctuations. In bad situations the investment manager might not be able to protect you against all exchange-rate risks, which may result in the capital protection, of Smartfund 80% Protected, being less than 80% of the NAV for the USD and EUR share classes.

Can you tell me more about their portfolio management?
  • Praemium's approach facilitates model portfolios (which they call Separately Managed Accounts) and bespoke portfolios (which they call Individually Managed Accounts).
  • You are allowed to hold multiple portfolios for every client, and different portfolios in each tax wrapper.
  • You can also mix between Praemium's model and bespoke portfolios in their Unified Managed Account.
Is it true that Praemium International is using AI on their portal?

Praemium International claims to be the only platform in the UK to harness the power of machine learning and AI to give you predictive analytics on your clients’ behaviour.

You can learn more about it on their website.

Is Praemium just for UK clients?

Praemium isn’t just for UK clients.

Through their international platform, you can deal seamlessly with international professionals.

Their international platform is based in Jersey.

They can deal with clients in the following currencies:

  • USD,
  • GBP and
  • EUR.

via this platform, Praemium International is also able to deal with people that are US-connected.

How are they preventing fraud?

Praemium uses a range of measures to try and prevent fraud, including:

  • bank-grade encryption,
  • regular penetration testing, and a
  • comprehensive disaster recovery plan
What are the tools offered by Praemium?

There are quite a few tools offered by Praemium International. It has an open API set which allows them to build integrations with other systems who are similarly open.

They are said to link to all of your major back office systems including their own Plum Software.  

Additionally, Praemium's on-platform tools include:

  • a comprehensive CGT calculator,
  • bulk rebalancing,
  • portfolio analytics,
  • portfolio reporting and
  • leading MI capabilities.
Does Praemium International offer tax wrappers?

Yes, Praemium International can offer you a range of tax wrappers.

These include ISA, JISA, GIA, Expat SIPP (Praemium Expatriate Retirement Account), and SIPP (Praemium Retirement Account).

They also offer access to third-party tax wrappers, including an onshore bond with Sanlam and various offshore bond providers.

Praemium also has links to QROPS, QNUPS, and RATs. Their open architecture allows for flexibility (after due-diligence checks).

Australia based advisory firm

Praemium delivers so much more than just a state-of-the-art platform.

Expert assessment of Praemium International

This is a popular platform for intermediaries and will likely become increasingly used by traditional IFAs who seek to disintermediate from the offshore insurance companies and offer their clients a better option.

If you are an existing investor with Praemium International, and your portfolio is worth approx. £500,000 or more, we recommend a Second Opinion.

GET A SECOND OPINION

Praemium International Smartfund Prospectus

Praemium International - 2020 Annual Report

Praemium International - Individually Managed Account Flyer

Praemium International - The Smartfund Range

Praemium International - Managed Accounts Brochure

Praemium International - Key Platform Features

Praemium International - Separately Managed Accounts Flyer

Praemium International - Separately Managed Accounts Product Disclosure

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Services

Company

Contact

AES International

Level 2, Exchange Tower
Al Mustaqbal Street (Future Street)
PO Box 191905
Dubai
United Arab Emirates

 
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hello@aesinternational.com
+971 (0) 4559 4900
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RISKS

Investments involve risks. The investment return and principal value of an investment may fluctuate so that an investment, when redeemed, may be worth more or less than the capital invested. Past performance is not a guarantee of future results. There is no guarantee strategies will be successful. For further information, please click here.

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