A lot has happened in the world of platforms this week — most of it in Scotland. First there was the news that Standard Life Aberdeen is selling Parmenion, one of its three platforms. Hot on its heels was the announcement that its Edinburgh neighbour, Nucleus, had received offers for its entire share capital. Last but not least, Novia is reportedly changing hands before Christmas (OK, Novia is technically not Scottish but bear with us).
In a move that cements its position as a platform for high-net-worth investors and family offices, 7im has cut fees for investors with more than £2m on platform. From 1st April, investors with between £2m and £5m will see their fees fall from 0.15% to 0.08% for assets between £2m and £5m, while those with more than £5m will see fees drop from 0.15% to 0.05% on balances over £5m.
Nucleus has finally confirmed what we’d suspected for sometime: it’s going to float on the London Stock Exchange’s AIM market. Transact was the first to take the plunge on 2nd March and in the same month AJ Bell announced that it was preparing a flotation in late 2018/early 2019. Nucleus’s announcement came on 2nd July, but it’s working to a punchy calendar and plans to have the whole thing tied up by late July, which is pretty fast by anyone’s book.
According to the Investment Association, the top sectors of 2015, by net sales, were UK Equity Income, Targeted Absolute Return and Europe ex-UK. Fund groups lucky enough to have funds in these sectors will have had a good year, and if their funds were on any shortlists, they probably had a great year. How much impact does being selected by a gatekeeper have on a fund's fortunes? We ran our gatekeepers analysis to find out which funds had performed best and whether there was any correlation between performance and the number of selections they had attracted. All of the funds shown below are ranked on their three-year returns. The tables below include a mix of the best funds by performance and the funds with the most gatekeeper selections. The ones with the most gatekeepers usually attract the most flows.
The trend for outsourcing investment has grown sharply in recent years, and with the advent of pension freedom it is only going to get bigger. Model portfolios and robo-advice are currently the talk of the town, but in the background funds of funds have been hoovering up assets.
According to Fundscape’s latest report Deconstructing the UK Funds of Funds World, FOF assets may only represent 12% of the total fund industry AUM (June 2015), but they punched well above their weight with 52% of industry sales in H1 2015. So in short, it pays to be part of this expanding market.