IFAs look much cheaper than their restricted equivalents according to the FCA which has released some more numbers from its suitability review. Independent advice with an average upfront fee of 2.81% looks much cheaper than restricted advisers’ 3.57%.
This could prove grist to the mill when the FCA expands its asset management review to look at platforms. It also has vertical businesses, which generally involve restricted advisers, in its sights.
FTAdviser.com devotes a long article to the FCA asset management market review. On this reviewer’s reading, fund managers have mostly dodged the bullet. For example it does not look as if the all-in fee is mandatory.
One final area for advisers to note is that the FCA is considering a sunset clause for trail commission on ‘off platform’ business by allowing fund managers to switch investors into cheaper share classes. It tends to be smaller adviser firms still receiving cash from this source.
The IFAs quoted in Professional Adviser say that the move may make sense but suggest that some more sales-led or retired advisers could suffer.
By way of contrast to all this discussion about charging, SJP’s Tony Mudd says advisers should be competing on value not on price. One wonders if he might not have been better keeping his head below the parapet at the moment.
Jargon-free-benefits boss Steve Bee queries whether we really are witnessing a war between the generations.
The FCA is to review the with-profits market looking at the operation of smoothing and guarantees. Advisers may wish to note that overall the sector passed muster when it was reviewed seven years ago by the then FSA so this may simply be a routine look.
Taped calls fail to save a WH Ireland from losing an FOS case.
Meanwhile many if not quite all market commentators are being decidedly bearish. US investor and economist Harry Dent remains convinced that UK property will crash soon. Sanditon’s Chris Rice suggests the business cycle is going to turn with big falls in markets possible.
Well known US investor Jim Rogers is predicting the biggest crash in our lifetime.
However, Neil Woodford is making a contrarian bet on the success of the UK economy including UK housebuilders.
Some very big names among the 17 accepted into the robo-advice development unit at the FCA including HSBC, Lloyds, NatWest, Santander, Nationwide, as well as advice firms Mortimer Mackenzie, True Potential, Personal Touch and Standard Life's 1825.
The FCA is failing better advisers by ignoring the issue of contingent charging on pension transfers argues New Model Adviser.
Phil Young writes of the 10 things you need to know about Mifid II.