Over the past five years, packaged portfolios have outperformed advisor-driven portfolio, according to new research from Cerulli Associates.

Cerulli said that one of the reasons packaged portfolios tend to outperform is because they remain invested in the markets throughout market pullbacks and recoveries.

"We believe the outperformance is primarily driven by qualified home-office teams dedicating their time to asset allocation, manager selection, and staying invested in the market during downturns," said Frederick Pickering, research analyst at Cerulli. 

"Home-office teams are more quantitative in their approach to manager selection and are not as swayed by qualitative factors such as fund company's reputation or wholesaler relationships."

Packaged portfolios currently represent almost $900bn in assets. According to Cerulli they are becoming increasingly popular and much of that success has been driven by a new business model, with direct platforms gathering significant assets without having a traditional advisor force.

"The home office is more removed from the daily concerns of clients, and as a result can maintain the resolve to stay invested while advisors feel pressure from their clients, and themselves, to act to avoid short-term losses," Pickering said.

"Advisors have a lot of hats to wear, and while advisors value flexibility, they must remember that portfolio construction is not a part-time job. On average, advisors spend 60% of their time on client-facing activities, 18% on administrative activities, and only 17% on investment management."