The Platforum is predicting large advice firms will slash the number of funds available on their panels from the current average size of 115 funds.
Based on interviews with 33 nationals and networks, The Platforum found that individual panel sizes varied enormously. It found while one advice firm had 600 funds on their panel, others reported a panel size of just 35 funds.
The research predicts the average panel size among large advice firms will drop before eventually settling at an average of between 50 and 60 funds.
It adds asset managers are likely to restructure sales teams to focus on networks and nationals rather than trying to appeal to individual adviser firms.
The Platforum also carried out interviews with 200 smaller advice firms each advising on less than £100m in assets.
It found that 61 per cent of total client assets are invested through funds picked in-house or through insourced models. But 68 per cent of smaller advice firms also said they are now outsourcing at least part of their investment process to a third party.
Threesixty managing director Phil Young says: “Over time fund panels are being used less, as more and more advisers are looking to model portfolios. The fund panel is there for when a centralised investment proposition does not necessarily fit for a particular client.”
Plan Money director and Tenet member Peter Chadborn says: “We have increasingly become advocates of outsourcing either to a discretionary fund manager or a multi-asset range. Because we have access to some strong models, the panel has not been a problem. It adds to the admin involved where we have to look off-panel.”