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IFA debate is urged on fund manager quality

Dennehy Weller managing director Brian Dennehy is calling for IFAs to share their investment research to create a debate on the quality of fund managers.

He says that smaller IFAs can design straightforward systems for fund selection without relying on expensive multi-manager products to do it for them.

He is offering his Topfunds guide – his own research – to IFAs to use as they please for 50 and says IFAs have nothing to fear from sharing their investment knowledge in the adviser community. He says not sharing research is forcing IFAs to think they need to outsource to multi-managers.

But Credit Suisse joint head of multi-management Gary Potter says 65 per cent of fund managers have changed jobs in the last three years and multi-manager products provide a solution for intermediaries who feel their ability to man-age performance in light of such change is impossible.

Dennehy says: “When multimanagers meet fund manag-ers, they are largely confirming what your objective statistics-based analysis is already telling you. The investor ends up paying for this.”

Potter says: “IFAs have an awful lot of work to do and putting their client money in our hands is like a GP referring a patient to a specialist. It is bunkum to suggest that a set of funds, even a great set of funds when it is chosen, will not perform significantly better if reviewed by a dedicated team on a daily basis.”

Plan Invest managing director Michael Owen says: “I do not think anybody can produce a guide to who the best fund managers are, especially by looking backward. I share Brian’s scepticism about multi-managers – if it was as easy as some of them make out, they would all be on a beach by now. But I do not think we would give our best secrets to our competitors. Brian is obviously prepared to do it for a price.”Multi-manager view, p26

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