Fintech and data provider Defaqto has today launched a new tool to provide comparisons between Managed Portfolio Services (MPS) and is also updating its MPS performance data monthly from now on.

Defaqto says its new MPS Comparators tool will enable advisers to compare MPS portfolios in detail.

MPS Comparator will allow advisers to assess portfolio performance between MPS providers and will help with regulatory responsibilities, the firm says.

Defaqto says until now there has been no easy and compliant way to make MPS provider comparisons from a whole market perspective.

Defaqto calculates that AUM in the MPS sector has grown from around £75.4bn at the end of 2022 to £85.8bn at the end of 2023 – up about 13.9% increase.

Defaqto’s DFM coverage spans over 120 DFMs and around 2,700 portfolios, detailing data such as performance, fees and asset allocation.

Alongside the launch of MPS Comparator, Defaqto is also updating MPS performance data monthly.

John Milliken, CEO at Defaqto, said: “For MPS providers, the performance comparators we’ve designed will offer competitor insight that we believe will become intrinsic to increasing assets under management.”

The new MPS tool will allow advisers to access Defaqto’s in-depth data analysis and scrutinise key performance metrics and asset allocation, enabling Consumer Duty-compliant advice.

Andy Parsons, insight manager for Investments at Defaqto, said: “Currently, DFM asset managers choose between IA sectors, CPI + or other industry Indices to compare their MPS portfolios against. These don’t provide an appropriate comparison when assessing, comparing, and showcasing the performance of a portfolio. From a Consumer Duty perspective, advisers and clients could be misled in terms of performance comparison.

“MPS Comparator allows users to segment the managed portfolio universe and provides greater in-depth analysis than has previously been available anywhere.”

The Defaqto MPS Comparator is available for advisers and providers and will be available in Defaqto Engage, Defaqto’s Financial Planning suite, soon.