'Bring in ISO to develop fund classifications'
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Syndaxi Chartered Financial Planners managing director Rob Reid wants the Investment Management Association and the Association of British Insurers to work with International Organization fro Standardization to improve fund classifications.
He says the recent Arch cru fund suspension show that the classifications are not up to scratch.
The IMA has come under heavy criticism for placing the Arch cru investment fund in the cautious sector des- pite its heavy exposure to private equity.
Reid says the fact the IMA and ABI cannot agree on ratings is a massive hindrance in the first place. He says: “If IFAs are to respect classifications, they have to be robust and not subjective in all of their aspects. The IMA will point to their caveats but we need them to start working with ISO to develop a standard method of classification worldwide, with the UK leading.
“You can argue that Arch cru was an extreme case but how did the funds get there? Perhaps placing them in the unclassified sector would have been a better statement. ISO runs a tested process which offers a measure of consis- tency which IFAs can rely on.”
An ABI spokesman says: “We are working hard to ensure that our fund classification works as well as possible for consumers and advisers.”
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Readers' comments (1)
Anonymous | 14 Jan 2010 11:16 am
Didn't Jon Maguire of CRU not chair the ABI classification committee?
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