Table of Contents
- Overview
- Catalyst
- Summary
- Methodology
- Executive Summary
- Market Context
- Sector Issues
- Table of Contents
- Table of figures
- Table of tables
- MArket Context
- The Survey sample consists mostly of sole traders
- Sole Traders account for just over 40% of the total survey sample
- Financial advisors' clients cover a range of wealth levels
- Financial advisors believe sales of many savings products will remain
unchanged in the future
- In terms of providers, financial advisors have a particularly positive
attitude towards Skandia, Friends Provident & Standard Life
- Skandia has been a prominent name in the UK savings & investments
market in recent years
- Friends Provident is one of the UK' s largest financial services groups
and houses one of the oldest asset management groups in Europe
- Friends Provident' s F&C asset management subsidiary is one of
the top five UK fund managers
- Standard Life is a leading UK fund manager employing a "focus on
change" investment philosophy
- In terms of mutual fund providers, advisors are most positive about
Invesco Perpetual & Fidelity
- Invesco Perpetual is one of the largest independent asset management
companies in the UK
- The Jupiter Group has received more than 120 awards over the past four
years
- Data
- Sector Issues
- Advisors' choice of provider is most affected by provider service and
financial strength
- Product features and historic investment performance area also factors
that feature heavily in an advisor' s decision process
- However, other factors such as broker consultant relationship and
commission, though less of an influence are still important
- Life companies' asset management arms have improved somewhat over the
last 5 yrs
- However, there are still a variety of improvements that could be made
in areas such as service, product performance, product features & fund
manager recruitment
- Skandia, Standard Life and Legal & General are perceived as having
particularly strong AM arms
- Jupiter, Invesco Perpetual & New Star are mutual fund providers
highly rated as asset managers
- The area of specialization varies between different fund managers
- Norwich Union, New Star and Standard Life are rated as the top
property fund managers
- Fidelity, Invesco Perpetual & Jupiter are rated as the top UK
equity fund managers
- Fidelity, Jupiter & Invesco Perpetual are also rated as the top 3
International equity fund managers
- Artemis, Midas & Gartmore are rated as the top boutique fund
managers
- Artemis & Gartmore have product offerings of particular interest
- Artemis is a dedicated active investment management house
- Gartmore has been managing long-only investments for over 30 years
- The key opportunities in the market lie with products such as wraps and
REITs, as well as areas such as the Far East
- Fund supermarkets and major life companies have been the main wrap
market participants of late
- Fund supermarkets and wraps are growing at a considerable rate in the
UK market
- There has been significant hype surrounding the introduction of REITs
in January 2007
- Size of fees have a most significant impact in the choice of life company
- Fees need to be transparent, as well as reasonable
- The range of funds is also important for all investments
- Advisors find complex funds fairly simple to communicate to clients
- Advisors have also found the same level of ease with manager of
manager propositions
- But despite the ease of explanation, higher charges are not always
indicative of worthwhile return
- There is a similar disparity of opinion regarding charges applied to
manager of manager funds
- REIT funds are seen as a particular area of growth
- Equity-based REIT products are seen as having the most market potential
- Data
- APPENDIX
- Definitions
- Fund of Fund Investments
- Manager of Manager Investments
- ICVCs
- Real estate investment trust (REIT)
- Methodology
- Further reading
- Ask the analyst
- Datamonitor consulting
- Disclaimer
- List of Tables
- Table 1: Funds under management levels, 2006, split by asset class
- Table 2: Composition of survey sample, segmented by type of company
- Table 3: Percentage of respondents who classify more than half their
customer base as high net worth
- Table 4: Percentage of respondents who classify more than half their
customer base as mass affluent
- Table 5: Advisor opinion as to how sales of certain investment
products will change over the next six months, % of respondents
- Table 6: Advisor attitude towards a selection of life companies, % of
respondents
- Table 7: Advisor attitude towards a selection of mutual fund
companies, % of respondents
- Table 8: Percentage of respondents who believe a selection of factors
have an influence on their choice of life company
- Table 9: Financial advisor opinion as to the development of life
company asset management arms over recent years
- Table 10: Providers perceived to have the best asset management arms
- Table 11: Mutual fund providers rated highly as asset managers
- Table 12: The top property fund managers
- Table 13: The top equity fund managers
- Table 14: The top international equity fund managers
- Table 15: Financial advisor opinion towards the effect of management
fees on their choice of life company
- Table 16: Financial advisor opinion towards the effect of management
fees on their choice of mutual fund provider
- Table 17: Financial advisor opinion as the effect of fee transparency
on their choice of investment product
- Table 18: Financial advisor opinion as to the importance of a wide
range of underlying investment funds for a selection of products
- Table 19: Financial advisor opinion as to whether they find fund of
fund investments straightforward to explain to their clients
- Table 20: Financial advisor opinion as to whether they find manager of
manager investments straightforward to explain to their clients
- Table 21: Financial advisor opinion as to whether they believe returns
achieved through fund of fund investments are worth the higher charging
structures
- Table 22: Financial advisor opinion as to whether they believe returns
achieved through manager of manager investments are worth the higher
charging structures
- Table 23: Financial advisor opinion as to the growth potential for
REITs over the next 5 years
- Table 24: Financial advisor opinion as to which type of REIT holds the
biggest growth potential
- List of Figures
- Figure 1: Sole Traders constitute just over 40% of the total survey
sample
- Figure 2: Just over a quarter of respondents have more than 50% of
their client base classified as high net worth
- Figure 3: Approximately half of respondents have more than 50% of
their customer base classified as mass affluent
- Figure 4: The majority of financial advisors believe sales of many
savings products will remain unchanged over the next 6 months
- Figure 5: Financial advisors are most optimistic as to the growth
potential of ISA, SIPP & personal pensions products over the next 6
months
- Figure 6: Very few advisors had an overtly negative view of providers
- Figure 7: A large proportion of respondents were indifferent towards
providers, citing the belief that their products were not matched to their
business model
- Figure 8: In terms of product providers, financial advisors have a
particularly favorable attitude towards Skandia & Friends Provident
- Figure 9: Financial advisors are most impressed by Invesco Perpetual
and Fidelity in terms of mutual fund providers
- Figure 10: Financial strength and provider service are the greatest
influences on an advisor' s choice of provider
- Figure 11: Over half of financial advisors believe that the asset
management arms of life companies have improved over recent years
- Figure 12: Standard Life, Skandia and Legal & General are
perceived to have the best asset management arms
- Figure 13: Jupiter, Invesco & New Star are mutual fund providers
who are also highly rated as asset managers
- Figure 14: Norwich Union, New Star & Standard Life are perceived
to be the top three property fund managers
- Figure 15: Invesco, Jupiter & Fidelity are the top rated equity
fund managers
- Figure 16: Fidelity, Jupiter & Invesco Perpetual are the three
most highly rated international equity fund managers
- Figure 17: Over three quarters of financial advisors believe that the
size of management fees have some impact on their choice of life company
- Figure 18: Over 70% of financial advisors believe that management fees
have an affect on their choice of mutual fund provider
- Figure 19: Half of those surveyed believed that the level of fee
transparency is a particularly important consideration when choosing an
investment product
- Figure 20: Having a wide range of underlying investment funds is
important in all product areas
- Figure 21: Nearly two thirds of financial advisors find fund of fund
investments relatively easy to explain to clients
- Figure 22: More than half of financial advisors find manager of
manager funds straightforward to explain to clients
- Figure 23: Nearly half of financial advisors believe that higher
charging structures on fund of fund investments are only occasionally
justified
- Figure 24: Just under a quarter of financial advisors believe that
returns achieved through manager of manager investments are not worth the
higher charging structures
- Figure 25: More than 80% of financial advisors believe REITs funds
have growth potential over the next 5 years
- Figure 26: Nearly half of financial advisors believe that equity REITs
hold the most potential out of all REIT products
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