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‘Portal check rule is unworkable’

The FSA is to require IFAs using a portal or sourcing system to put in extra checks to ensure that they are considering the whole of the market.

The move, revealed in the RDR feedback paper, is part of plans to tighten up the definition of independence.

The FSA says if one provider’s products are available on a portal because they have paid a fee and another firm’s plans are missing because they have not paid a fee, using this system alone would not “satisfy conditions for a comprehensive or fair analysis of the market”.

However, CBK Colchester principal Peter Chadborn says it is “so unworkable” to enforce such a requirement on IFAs that it would have to be up to the portal to put measures in place.

He says: “If the FSA is going to enforce this, every portal knows they are going to have to cover whole of market and rethink their strategy. The portal will have to negotiate to get every provider on that portal.”

Financial Technology Research Centre director Ian McKenna says: “The FSA needs to introduce some obligation on providers to make information readily available to avoid undermining the advice process.”

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Strong dollar can be a powerful driver of UK dividend growth in 2015

By Robin Geffen, fund manager and CEO 

This year threatens to be a challenging one for UK dividend hunters. Last year saw an all-time record amount paid out in UK dividends — some £97.4bn, according to research from Capita Dividend Monitor. Yet as Capita also pointed out, out the biggest single factor driving the growth in the fourth quarter of last year was easy to identify: the rising US dollar. 

In our view, this trend is much more than simply a one-quarter phenomenon. It is actually the most profound issue to get right as a UK equity income investor in 2015. We believe that the US dollar will continue to strengthen significantly from its current level. This is due more to the US economy’s demonstrable de-coupling from the rest of the world than to a view on the UK. The US has a strong chance of tightening monetary conditions this year without jeopardising growth or de-stabilising its housing market. The same can unfortunately not be said about the UK.

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