Post-RDR advisers have to consider all investment options including investment trusts, but does the lack of access to them through some platforms make a difference? Investment Adviser asks some advisers for their views.
NO:
Andrew Swallow, director and chartered financial planner, Swallow Financial Planning:
“We use Transact and have been investing in investment trusts, exchange-traded funds (ETFs) and anything else that is in the clients best interest before and after RDR. So this doesn’t really apply to us.”
MAYBE:
Susan Hill, chartered financial planner, Susan Hill Financial Planning:
“I haven’t previously used investment trusts but easy access via a platform and charges had made me look very seriously at them. But it is still a question of client suitability.”
YES:
Carl Melvin, certified and chartered financial planner, Affluent Financial Planning:
“The lack of access from the fund platforms clearly demonstrates the difference between platforms and wraps. Does it make a difference – to advisers, not really as they can access investment trusts elsewhere. However, it does impose a restriction on the consumer. We adopt a passive approach, but I think there is evidence that net inflows to investment trusts has increased post-RDR as the barrier of no commission on investment trusts has been overcome by adviser charging at wrap level rather than asset class level.
“It would be in the consumer’s best interests that platforms allowed access to all asset classes irrespective of rebates – that would really remove the conflict of interest inherent in fund platforms and improve Treating Customers Fairly. The lack of ITs on fund platforms is a clear illustration of how ‘old model’ the fund platforms are – this will become more apparent when rebates are abolished and fund platforms lose revenue.”
