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Vanguard to launch UK D2C platform

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Vanguard is to launch a D2C platform in the UK, Money Marketing understands.

It is understood the fund house is close to signing a deal with technology firm FNZ to build the platform.

Vanguard is the latest fund manager to make a foray into the platform market, after Aberdeen Asset Management announced its acquisition of Parmenion Capital Partners earlier this month.

Vanguard is among those leading the robo-advice charge in the US, with the launch of its Personal Advisor Services in May. The service charges 0.30 per cent of assets per year and combines automated investment portfolios with adviser telephone support for those with at least $50,000 (£32,373) to invest.

It previously offered an advice service in the US to those with a minimum of $500,000 (£323,735) at a cost of 0.70 per cent per annum, and is in the process of transferring these clients to the lower cost offering.

Platforum head of direct Jeremy Fawcett says: “Vanguard has always had a D2C offering in the US so there has long been a possibility of it launching into the market in the UK.

“With the growth in popularity and understanding of passives by consumers over the past few years, and the evolution of the Vanguard brand in Europe, it makes sense to make the move now.

“There is growing interest among asset managers in direct distribution, and Vanguard is better suited to this channel than most as its products are simple and tangible for consumers.”

Hargreaves Lansdown head of passive investments Adam Laird says: “Vanguard’s proposition is to create low cost, simple products which are easy for consumers to understand, which fits well with a direct offering.

“Competition is always welcome and if more players enter the D2C market it may help to improve service and reduce costs.”

Vanguard and FNZ declined to comment.

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. I trust Vanguard are smart enough to pivot this and offer their tools for advisers to use with their own clients.

    The “Robo-Adviser + Chartered Financial Planner” model seems to me like a winning proposition to all parties.

  2. Strange that Vanguard would charge so much. O.3% is hardly competitive for larger portfolios

  3. Odd isn’t it. Low cost SHPs didn’t encourage the masses to save, as we in the advice profession knew they wouldn’t, yet somehow the same audience will flock to direct offerings according to their protagonists. In China, the crash in the domestic market was mainly caused by the gullible and non advised to pile into investments they didn’t understand.

  4. Tim tim@pagerussell.co.uk 23rd September 2015 at 11:48 am

    @John Blackmore: That’s 0.30% all in for the fund, the platform AND the online guidance/advice…

  5. At this price they will have to attract a hell of a lot of volume and if this does happen we all know the consequence of large volumes of cash flowing into a limited number of funds.

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