Last week Tenet Group came out with plans to launch a new investment arm next April that is designed to offer advisers a profit share in the business.
Speaking at the first of four conferences chief executive Simon Hudson said the group would be called Sinfonia as it resembled “the bringing together of musicians and instruments to orchestrate a great performance.”
Sinfonia proposition is simple. The group will look to launch an initial five or six multi-manager funds that will have different risk profiles. These will be managed on a daily basis, with the idea of offering much fairer and transparent pricing to the marketplace.
Hudson says the launch is a natural progression for the firm, which has some £15bn of assets under influence.
Tenet has charged the running of the company to Craig Knight, who joined the firm last week from Thesis Asset Management as managing director.
Knight said the group is to look at further portfolios should the market demand them in the future, but the initial range is likely to be comprised of growth and income options.
What is interesting is that Sinfonia intends to outsource the management and administration of the funds to an unnamed internationally known fund manager. This sparks up a number of names, but what is also interesting is that with advisers also having a profit share in the business it could offer them greater control as TCF becomes all the more prevalent.
Should Tenet Group look to float or sell the business, advisers are also set to receive a portion of the shares directly in relation to the amount of asset they have invested in the funds.
Hudson says: “We feel this sits in well with the retail distribution review by offering greater transparency and distribution for the industry. The offering will have an Isa capability and a Sipp wrapper and we hope to add it across a number of wraps and platforms as soon as possible.”
Whether or not this sits in tune with the RDR is almost secondary to some advisers, the question will be that given the masses of multi-manager offerings that keep coming into the market, much of Sinfonia’s success will be on who takes on the administration and how great the price differences are from those it is competing with. If Tenet can crack that solution the support base is there to build up a massive offering that will offer advisers a bigger piece of the pie.