Standard & Poor's Fund Services (S&P) has rated Aviva's separately managed account (SMA) model portfolios, paving the way for inclusion of the products in dealer group approved lists.

The ratings agency awarded three stars to the Aviva Investors Core Opportunities, Aviva Investors Dividend Builder, Goldman Sachs JBWere Core Australian Equities and UBS GAM High Alpha Long Term Opportunity portfolios.

It also gave four stars to the Aviva Investors Blue Chip Top 20 and Ausbil Australian Concentrated Equity portfolios.

"As the managers are aware of the specific SMA risks, the model portfolios tend to have similar characteristics," S&P analyst Rodney Lay said.

"Generally they are concentrated, low turnover buy-and-hold, high manager conviction, Australian equities mandates in which investment decisions are primarily based on a long-term fundamental, bottom-up research methodology."

Apart from reviewing the underlying managers, S&P took into account the suitability of the model portfolio within the SMA environment.

The agency said the risks of portfolio turnover and average size of trades, which could result in high costs for investors, were appropriately addressed.

A three-star rating is generally considered as the minimum level at which dealer groups will add products to their products lists.

Aviva distribution development manager Stuart Fechner said it was "fantastic" to get the official tick.
 
"It's a positive step forward to SMAs getting some traction in the market," he said.