Transact managing director Ian Taylor says it is wrong for asset management companies to assume that they can gain a greater share of distribution by launching their own platforms.
Taylor’s comments come in response to JP Morgan Asset Management head of UK retail marketing Keith Evins’ recent suggestion that asset management companies may offer their own wraps to secure a greater share of distribution.
Taylor believes some life companies or fund supermarkets might look to gain market share through advertising their wrap but says a platform is not designed to grow distribution.
He says: “I would be very suspicious of anyone who thinks that launching a platform will give them distribution. We do not regard ourselves as providing distribution, nor does anyone provide distribution for us.”
There is an incentive for asset managers to set up a platform in order to charge basis points on other people’s funds, says Taylor but he considers that the idea that an asset manager could gain greater market share in distribution through a platform is outdated.
He says: “They have not really cottoned on to the way the market is changing. It makes sense as a way of catching revenue from a diversified port- folio from an asset manager’s point of view but it is not a way to promote individual products.”