View more on these topics

Investment view

If 2002 had been about survival, then 2003 was the year of rehabilitation. Or at least so thought the chairman of Betelgeuse Investment Funds as he sipped a sherry, looking out from his office at the fast-flowing Thames beneath.

Mind you, he mused, the first few months had felt more like failing to survive. It had been the worst season for Isa sales he could recall and as for the performance of the stockmarket. He shook his head. This was one memory that he was happy to leave behind.

Straightening his back, he thrust out his chin as he walked to the other end of his office where a window gave him a panoramic view of the dealers and telesales staff still maintained in his expensive London headquarters. Admittedly, there were more empty desks these days. Not as many as there could be, he thought.

India was beckoning for a number of functions that were easily transferable. If a unitholder had a query, why not deal with it through someone whose cost will be less than one-quarter of those people out there? He mentally engaged a project for the new year.

It was in dealing and settlements that he felt he should be making most of his savings, though. But for that he needed the industry to change. Even that insurance levia-than, Lloyd&#39s of London, was moving to electronic transactions and processing.

Why was the UK unit trust industry so far behind? Someone needed to break the mould. There were initiatives around but nothing had yet gained full support. 2004 could be an exciting year. Perhaps it would be the year of change.

Of course, the one area where he had been forced to make cuts early on was proving to be the most costly to rebuild now that the market had a better feel to it. Salespeople, when they are not selling, are an expensive commodity. As the build-up to war in the Gulf commenced, so he had felt it necessary to let go those whom he felt were not paying their way. Now he was finding that others were in the market bidding fancy sums for people whose ability was unproven. Amazing what a difference a year can make.

But rebuilding his sales operation to resemble that which had existed before no longer looked sensible. There were many other elements to take into account these days. What would happen under new polarisation rules? How much power would devolve to the bancassurers? Would the major product manufacturers be obliged to outsource some of their investment management to specialist houses? If so, that would be good news for him.

With his marketing background, the chairman relished the challenge of building a new strategy to cope with a marketplace where the pace of change was still accelerating. Even the Government was coming round to accept the industry view although he was sufficiently cynical to recognise that this had less to do with what they intended to do than what they needed to say. But that we did not save enough was clear for all to see. Somehow, savings in investment products had to be made more attractive and more accessible. Somewhere in all this he was sure that Betelgeuse had a role to play.

Returning to the river, he once again indulged his nose in the salty aroma of the manzanilla. 2003 had not been all bad, he decided. True, he had lost some fund managers but they had been more easily replaced than he had dared hope and sufficient of the big boys were experiencing trouble maintaining the performance of their funds across the full range for him to have one or two stars in certain sectors. Indeed, he now had some ranked managers – something else to go out to sell.

A far away look crept into the chairman&#39s eye. 2003 may have finished well but there were plenty of storm clouds on the horizon. The investment management industry had to become leaner and meaner in an era of lower returns and there were still too many firms competing for business.

2004 could be the year of consolidation, thought the chairman. He needed to be in the vanguard of any restructuring. Decisively, he pressed the buzzer on his intercom. Asking his secretary to bring in the competitor intelligence that they maintained, he knew which project he would most enjoy during the year ahead.


Independent view

Dare I say it, but the pension review still lingers on like a dark shadow over the reputation of pensions and everyone connected with them. The public have been left with a nasty taste and severe doubts about what to do for the best.Having said that, we have definitely noticed an upturn in morale among […]

Aberdeen sells NVM in management buyout

Northern Venture Managers has been sold to its senior staff for around £3m by Aberdeen Asset Management, which acquired it as part of a deal for Edinburgh Fund Managers last October. The buyout was led by managing director Alistair Conn and investment director Tim Levett, who say they are relieved to have put the company […]

Banks still cheapest mortgage lenders – Defaqto

Defaqto&#39s latest annual survey of mortgage costs reveals that banks were the cheapest lenders in 2003, with four banks in the top five places. The survey shows that for standard variable mortgage costs or their equivalent, Egg and HSBC occupy the top spots, followed by Nationwide, Intelligent Finance, Direct Line and Standard Life Bank. Special […]

Norwich Union – Fixed Income Plan 4

Type: Capital-protected bond Aim: Income linked to the FTSE 100 index Minimum-maximum investment: £3,000-no maximum, Isa £3,000-£7,000 Term: Five years Guarantee: Original capital returned in full provided the FTSE 100 does not fall by more than 30% and returns to at least its starting level Return: 0.44% income a month, 5.65% income a year, 31.28% […]

Parental leave and pensions

Fiona Hanrahan  – Senior Product Insight and Technical Support Analyst We are often asked how parental leave impacts workplace pension schemes in terms of funding in general, auto enrolment and salary exchange. This article will explain each of these. How does parental leave impact the funding of workplace pension schemes? A member of a defined […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and thought leadership.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm