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Fidelity warning IFAs to ignore Isas at their peril

Fidelity is urging IFAs not to write off the coming Isa season, warning that they could be in danger of losing market share to the banks and tied salesforces.

Contrary to the current wave of pessimism in the fund management industry, which has seen several groups slash ad budgets to as little as 20 per cent of last year, Fidelity is confident that there will be an Isa season this tax year.

Using historic Isa and Pep sales data, Fidelity predicts that at the very worst, this tax year&#39s total Isa sales will total £7.6bn, about 24 per cent down on last year&#39s total of £10bn.

Of this, it predicts that at least 34 per cent of sales will be in the three months up to the end of the tax year compared with 35 per cent to the same period in 2001.

Fidelity points out that in 1999, when Peps were replaced by Isas, IFAs initially lost significant market share to banks in the tax-free investment market because they were wary of the new product.

It believes the same will happen now if IFAs do not seize the opportunity.

Marketing director David Cowdell says: “There is a danger that the mutual fund industry is talking itself into a bad Isa season. We will be doing all we can to facilitate sales for IFAs this Isa season and that means coming out of our blocks early in January to create a favourable backdrop for advisers. While the bulk of Isa sales always come thr-ough in March, we know that much of the hard work is put in by advisers much earlier in the year.”

Fidelity&#39s FundsNetwork supermarket is ditching Standard & Poor&#39s Micropal in fav-our of Morningstar as the quantitative data provider for its platform. Standard & Poor&#39s will still provide its qualitative fund research ratings for the site.

Investment, p20


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