Advisers outsourcing investment business
Share
Nine out of 10 financial advisers are outsourcing their investment management duties or are considering doing so ahead of the RDR, according to Rathbone Investment Management research.
It says 47 per cent of IFAs are already outsourcing and 42 per cent are actively considering it.
Investment director Robert Hughes-Penney says: “In the run-up to the RDR, IFAs will be looking to limit their exposure to risk and reduce costs.
Outsourcing services to a third party is one option many are considering.”
Paul Duckworth IFA Paul Duckworth says he outsources investment management to a third party for clients with large pots. He says: “For pots of more than £100,000, I tend to use a discretionary fund manager as I do not have time to look at the screen and decipher whether to take assets out of fund Y and place them in fund X. To make sure things run smoothly, the discretionary fund manager, client and myself get together every 12 months to discuss whether the aims of the client are the same and that the investment meets those aim.
“For less than £75,000, I would usually do it myself, whether that is down to the discretionary fund manager not wanting to take on such a small investment or simply because it is more efficient to run it myself. I think there will be more outsourcing after the RDR but I expect more advisers will try to boost their knowledge and qualifications.”
But Churchill Investments director Chris Gilchrist says: “There will always be investment advisers who see investment management as the focal point of their business and will choose not to outsource. Barring niche areas such as investing in hedge funds, we will always do our own investment management duties.”
If you enjoyed this article, sign up here to receive daily email updates from Money Marketing and Follow @_moneymarketing
