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Should advisers leave fund selection to the experts?

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FCA warns DFMs could be used to hide investment scams

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The parallels between golf clubs and DFMs

Imagine you have a new neighbour who is a keen golf player and he wants to join the club you attend. He asks if you can help him obtain membership. He mentions his last club had recently dropped the handicap level and he was frustrated by the number of relatively novice golfers clogging up the […]

Vanguard launches D2C investment platform

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What triggers the MPAA?

Jim Grant – Senior Product Insight & Technical Support Analyst There’s sometimes confusion around what triggers the money purchase annual allowance. Find out what does and what doesn’t trigger the MPAA. The money purchase annual allowance (MPAA) is a reduced annual allowance that can apply to contributions to defined contribution (DC) schemes. The following table […]

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. The experts? I consistently beat DFMs when it comes to portfolios at less cost. Farm it out to DFMs and explain to clients that you haven’t a clue what they are doing and when it goes wrong still pick up the can. What a great business model.

  2. What a patronising twerp.

    Even if I was to consider using a DFM I would certainly not use one that basically called me an idiot and said I should leave it to the big boys who know better than silly old me.

    In my experience all the ‘depth of talent and resource’ at DFMs does is load cost onto the client portfolio and still get investment decisions badly wrong producing invariably poor returns.

    @paul barnard – well done on your portfolios beating DFMs but that’s hardly a proud boast is it given the opposition.

    • Horses for courses I think.

      If you have the time, skills and research capability then selecting assets and funds (Active and/or Passive) is fine. If not then DFM’s are a competitive way to achieve this.

      I am more about planning than product / asset selection and always tell my Clients not to thank me personally if there portfolio makes good returns because ‘WHEN’ the [portfolio goes doen I personally will not accept any ‘brick-bats’.

      Each to his own and just because this works for my company does not mean it is a template for success.

  3. I think it is pretty clear that adding layers and layers of DFM & Multi-Manager cost is not the answer.

    Advisers owe it to their clients to pick the right funds based the evidence for low cost, low turnover funds. Anything else is just marketing.

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