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Autif figures contradict commission bias claims

IFAs sell more top-quartile funds than any other distribution channel, according to research released by Autif.

Three-quarters of funds recommended by IFAs between 1999 and 2001 have top-quartile performance over the past five years while those sold through tied agents and direct channels have a weaker track record.

IFAs also sell more Standard & Poor&#39s rated funds than tied agents or other direct channels, with almost half of funds sold through IFAs holding an A, AA or AAA rating.

The figures have been compiled by the investment trade body as part of its submission to the Sandler review. Autif says it wanted to illustrate that IFAs select funds principally on performance, backed up with qualitative ratings, and are not generally swayed by factors such as commission.

Autif is also investigating the extent to which IFAs rebate commission.

Director general Richard Saunders says: “IFAs are picking funds with good track records and strong ratings, which is a positive message. It seems they are not doing it on the basis of who pays the biggest commission. When one looks at the intermediary distribution channel, it is very much driven by a search for performance and quality.”

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