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&#39Advisers rely too much on fund past performance&#39

IFAs rely too heavily on past performance when recommending investment products to clients, according to Ron Sandler.

But his claim has been rejected by the industry and IFAs who say investment performance is too important to ignore when choosing a fund.

In his consultation paper published this week, Sandler questions the importance of past performance in determining advisers&#39 recommendations and what impact it has on product providers&#39 investment strategies.

But Autif says past performance is an important tool for IFAs and it has yet to see any evidence which points to IFAs relying too heavily on it.

Director of communications Anne McMeehan says: “I suspect there are factors other than past performance and commission at work. I think it would be constructive for there to be empirical evidence which genuinely demonstrates the motivation when making inv-estment decisions.”

IFA Baronworth Investment Services director Colin Jackson says: “I think past performance is important. You do need to know how a fund has performed in the past before you recommend it to a client.”

IFA Riach Independent Financial Advisers proprietor Bob Riach says: “I totally disagree with it. You have got to take past performance into account.”


ScotLife moves into protection market

Scottish Life is setting up a new protection business in Edinburgh, solving the mystery surrounding the identity of the new Scottish player. It is understood to be headed by former Scottish Provident head of marketing and business development David Robinson. Money Marketing understands ScotLife has been recruiting former ScotProv staff who have left since the […]

FSA probes policies for cash bias

The FSA has launched an investigation to determine if IFA commission levels affect the products and providers they recommend to clients. The regulator is demanding that life offices supply it with information about the commission they pay IFAs on the extent of their product range. Life offices must hand over the numbers of new policies […]

House price rises &#39unsustainable&#39

House prices are rising at an unsustainable rate but show no signs of slowing down, Nationwide Building Society is warning. The lender’s latest house price index shows property prices have shot up 10.9 per cent since last year, rising 1 per cent in July. Although last month’s figure marks a slowdown from June’s growth of […]

Sandler slams &#39poor-value&#39 with-profits

Ron Sandler has launched a blistering attack on with-profits policies, slamming them for lacking transparency and offering poor surrender values. He has also savaged fund managers, questioning their investment objectives and accusing them of viewing good marketing as more imp-ortant to sales than investment performance. The role of the Government as a regulator of product […]

Trouble ahead - thumbnail

Pensions: trouble ahead?

The pace of change in the pension’s space has been little short of astonishing, and has left thousands of employers struggling to keep their pension policy compliant, and also on the right side of current best practice and governance. Many employers, and indeed many in the pensions industry itself, would like to see a period of no change during the next term of government. This would give all sides a chance to catch up and draw breath. 


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