Shares in Hub24 Ltd (ASX: HUB) climbed 3% higher to $13.96 on Wednesday, after the company announced that wealth management firm Fitzpatricks Private Wealth selected HUB24 as its technology partner.
HUB24 adapted the managed portfolio functionality of its investment platform, tailoring it to Fitzpatricks' range of managed portfolios. Under an initial five-year agreement, the transition to HUB24 of Fitzpatricks' Managed Discretionary Account (MDA) service, with its $700 million funds under management, is expected by late 2018.
The partnership may soon extend beyond MDA – Fitzpatricks' premium investment offering – to include Investor Directed Portfolio Services and superannuation.
HUB24 expects the deal to increase its funds under administration, $7.4 billion as at March 31, by 5% to 10% over the next year, and improve financial results.
Wealth management software providers are some of the fastest-growing stocks in the financial services space, eroding the market share of more established players like Macquarie Group Ltd (ASX: MQG) and Colonial First State of Commonwealth Bank of Australia (ASX: CBA). HUB24 is up 124% in the past 12 months, outperforming fintech competitors Bravura Solutions Ltd (ASX: BVS) and Netwealth Group Ltd (ASX: NWL), up 110% and 69% respectively over the same period.
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