You’re probably wondering where we’ve been these past few months, and have been bemoaning the lack of insightful posts and general industry chitchat. The summer is always a busy time for us, but as well as our usual publications and quarterly workload, we’ve had our noses to the grindstone producing a large study on behalf of Alfi, the Association of Luxembourg Fund Industry.
This is the first time week that we’ve actually been able to come up for air. The report is done and dusted, it has been sent off to the printers and I’m finalising the presentation for the Alfi conference next week when the report will be launched. Details of the conference on 23rd and 24th September can be found at www.alfi.lu. However, you don’t have to attend to get hold of the report. On the day of the launch, it will be uploaded to the website and will be freely available to download (we’ll post a link on here to make it easier for you to find).
I spoke at Fund Forum in Monaco two weeks ago, and having spent last week catching up, I was looking forward to writing a more detailed review of my presentation and the report on which it was based today. However, my plans were thwarted by an FT article that — at best — took some lines out of context and at worst, inaccurately reported parts of the report. How they got their hands on the report is also questionable since it wasn't circulated to the press and the FT didn’t buy it.
Our quarterly Platform Report was published a couple of weeks ago. It’s popular with platforms and fund managers as it allows them to benchmark themselves and monitor overall trends in the platform space.
Some platforms are reluctant to share their quarterly figures (sales and asset growth), so the report is confidential and circulation is restricted. We release headline industry figures to the press and throw in the top three platforms for assets, asset growth, gross and net sales. However, the large multi-proposition platforms can often obscure developments in certain areas of the industry. As a result, we also analyse platforms by their different propositions, which include fund platform, wrap, corp/DC, institutional, sub-advised and D2C. Some of the proposition breakdowns are estimated, but we try to get as much guidance on our estimates as possible from the platforms themselves and from their competitors.
It’s been very busy in the D2C platform world and competition is hotting up as the April deadline for unbundled platform pricing approaches. Hargreaves Lansdown was the first to announce its post-RDR charging structure and was followed by Fidelity, Barclays and a host of other discount brokers and direct platforms in the days and weeks that followed.
The rain has stopped, the sun is shining and it feels as though we’ve got through the worst of the weather. It’s half term so half of the industry is away and so it’s been a quietish week. We Fundscapers were bogged down in our various quarterly/year-end reports until Old Mutual gave us something to think about.
The group announced its new solution two weeks ago, but it was only today that it published the details of the WealthSelect fund range and the AMCs. There are 20 sub-advised funds from 10 fund managers. Being a bit of a nerd, I added up them up and worked out that the average was 58bps and not 52bps, so I can only assume that Old Mutual funds have also been included in the 52 bps calculation.
In theory, everyone’s a winner. Advisers get access to a balanced fund range at cheaper prices. Check. Fund managers get distribution in exchange for lower AMCs. Check. Old Mutual can use fund revenues to offset platform costs. Check.
For those of us forced to get round London in the awful weather and no tube network, what a nightmare week! On the financial services front, it was fairly quiet until Old Mutual Wealth announced its new fund range and portfolio management service yesterday afternoon and then the twitterati got busy. Old Mutual Wealth includes two separate businesses — the Skandia platform and Old Mutual Global Investors (OMG), the fund manager arm.
Prior to RDR, the platform was able to wrestle some pretty good rebates out of fund managers, but in the post-RDR world, securing the same kind of pricing from fund managers was likely to prove a challenge unless the platform could demonstrate that it had distribution influence. But even more important was securing distribution deals for its in-house fund manager, OMG. As a result, a combination of the Skandia platform plus a range of well-priced, sub-advised funds and solutions targeted at cost-conscious advisers became the strategy. The message is clear: we are a one-stop shop for restricted advisers.
January is usually an austere month. After the Christmas and New Year festivities, not only do we have far less money, but it’s also becoming the norm to give up alcohol for the entire month. Add to that our (mostly) unrealistic New Year resolutions to get fitter, get richer, and get better at a variety of things and January becomes a very tiresome month.