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Capita launches forward-looking risk rating tool

Capita Financial Software has launched a risk rating tool which allows advisers to use forward-looking analysis to see how underlying assets are likely to perform over time.

The Synaptic Risk Ratings service, backed by economic modelling from Moody’s Analytics, uses a probability-based risk measure to project possible outcomes from an investment so that advisers can discuss what percentage of a client’s portfolio could be gained or lost over a certain time period.

The tool currently covers investments from Canada Life Investments, Scottish Life, Seven Investment Management, Premier and Quilter Cheviot, with more providers added on a quarterly basis.

It will be free to existing Synaptic and Client Care Desktop users, and is available on a six-month free trial basis to other advisers. 

Capita Financial Software managing director Adam Byford says: “It is impossible for advisers to rely on the inconsistent labels funds are given, such as cautious or balanced, to meet client risk appetites. Current risk rating services are a useful measure, but often mean advice is given on a non-objective basis. 

“Advisers can now measure the probability of what is likely to happen to an investment over the long-term, with our forward-looking analysis of the underlying assets.

Separately, support services firm SimplyBiz has also decided to renew its Synaptic contract with Capita for a further five years following a one year trial.

Evolve Financial Planning director Jason Witcombe says: “The risk information on disclosure documents can be misleading so a forward-looking tool does sound interesting.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. What’s the one thing that’s less of a guide to the future than past performance? Projections!

    This has the potential to be the illustrations fiasco all over again, only this time in 3D. What did Capita estimate as the probability of the “cautious managed” scandal in 2009?

  2. E L Wisty (an only twin) 28th November 2013 at 11:15 am

    Regardless of the merits of this tool, any potential purchaser should consider whether they wish to support Capita in light of the CF Arch cru debacle, and that company’s proven failings and subsequent consequences for the IFA community and investors.

    Wouldn’t it be great if IFAs stood together for once, and refused to deal with such companies?

  3. @Mr Wisty : you beat me to it … IFA Centre has declined to arrange deals with this firm – quite apart from the quite stunning irony that Capita says it has a tool that uses a probability-based risk measure to project possible outcomes from an investment so that advisers can discuss what percentage of a client’s portfolio could be gained or lost over a certain time period.
    Perhaps their first customer should be Capita Financial Managers Ltd and they might not get into such a pickle again …

  4. E L Wisty (an only twin) 28th November 2013 at 7:08 pm

    @ Gillian Cardy

    I must admit Gill that, since Capita did its Houdini trick, fund selection got a lot easier. Any fund with CF at the front of the name doesn’t get past first base.

    Would be nice if funds also adopted this approach when conducting due diligence in respect of ACD selection.

  5. @Gill – Snap – never knowingly do business with a firm who does a back room deal to wriggle out of its responsibilities. Capita – Sue me …. don’t think so as it was a backroom deal which will never nbecome public because of how it was handled. A bit like the buying of HBOS by Lloyds with NO due diligence. There are a LOT of p**#ed off LTSB staff whose sharesaves were wipred out by Golden Brun’s leverage of LTSB. What did he have on them.

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