There has already been evidence of more advisers allocating to model portfolio services since the consumer duty has come in, but this could be accelerated in the next couple of years, according to Lawrence Cook.
FE Fundinfo's 2024 Financial Adviser survey found advisers have been increasingly interested in model portfolios since the introduction of the Financial Conduct Authority's consumer duty last July.
About a third are already using a custom MPS to deliver personalised advice, and a further 13 per cent told the survey they were planning to use one in the near future.
Other reports have echoed this trend. NextWealth, for instance, found last year the MPS market was growing faster than the platform market, as costs for clients were falling.
Cook, a former director at DFM Thesis Asset Management who now runs an MPS comparison service, says the consumer duty will "turbo charge" this development.
This is because on the one hand it coincides with an already growing financial planning sector, and on the other it has imposed more stringent requirements on advisers to monitor value and evidence decision-making and ongoing service.
"From an investment point of view I think some advisers will have come to a conclusion that they don't want to be seen as responsible for the investment returns, they'd rather be responsible for the financial plan and the advice," says Cook.
"The rise of financial planning, as distinct from a financial advice, has been significant. There are many firms now that focus on goals as opposed to investment."
He adds: "The other reason why an adviser might stop doing their own investment or advisory portfolios is purely one out of operational groundwork.
"There's a lot of pressure on you now to say, well, if I've actually got to do these [annual] reviews, and demonstrate I've done them, I've got to find something that gives, and that something that gives I think is finding an easier way to deliver the investment bit."
But he says the trend would have been happening even without the consumer duty: "The rise of MPS was happening anyway but I think this will put a turbo charge in it."
Legacy assets in particular could be shifted into managed portfolios in the coming years, he notes.
This is partly because they might sit outside of a firm's centralised investment proposition, and partly because the consumer duty phase two, which begins at the end of July, will mean legacy products will also need to be fully compliant with the duty.
"We've seen massive growth in MPS, but I don't think we've seen the half of it yet," says Cook.
'Evolution of the MPS'
Cook, who launched Mabel Insights earlier this year following a career in discretionary management, called the DFM space "dynamic" and believes it will experience a raft of developments in the coming years.
