As the growth in outsourcing continues how should advisers and DFMs cater for this?

Transcription

1 As the growth in outsourcing continues how should advisers and DFMs cater for this? Dynamic Planner Adviser Engagement Roadshows 2016 October/November 2016 For professional advisers use only

2 Introduction The drivers for growth Selecting a Discretionary Fund Manager (DFM) and Managed Portfolio Service (MPS) Performance reporting Lead by example - service & support 2

3 Growth of DFM & MPS Forecasted adviser DFM use Year/Stats Bespoke Portfolio Services Managed Portfolio Services Platform Managed Portfolio Services Unitised Discretionary Fund Management Services Total th June Growth (YTD) Growth Rate 5.01% 8.19% 3.11% 25.22% 6.00% Notes: All data is estimated based on Adviser only Business Flows records in Data reflects estimated size and growth figures for the Intermediated, UK, DFM Market from the 1st Jan 2016 to the 30th Jun 2016 Data is based on Net New Business and Market Movement for managed discretionary assets UDFM includes all Funds which are predominately marketed or employed as a unitised alternative to a discretionary proposition. The figures will exclude Funds used as MPS building blocks which will be included in Platform MPS or MPS Direct figures Platform MPS is defined as Models that are hosted and administrated on recognised Wrap Platforms. This does not include propositions where the DFM has an in house Wrap Platform and administers their own MPS. The figures for these groups will be within Direct MPS (Eg Standard Life Wealth, Parmenion, Old Mutual Wealth). Firms that have adopted an external platform, but use this almost exclusively will be included in Platform MPS, provided the models are available on other wrap platforms (e.g. 7IM, Tatton Wealth) Figures may be different from previous estimates due to more recent data capture Data is based on flows via external Financial Intermediaries (Financial Advisers and Chartered Financial Planners outside the DFM Group) 3

4 Selecting a DFM Create a Long List 4

5 Selecting a DFM Create a Long List Look at DFM Culture and Management 5

6 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process 6

7 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process Features of the Managed Portfolio Service 7

8 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process Features of the Managed Portfolio Service The Experience of the Team 8

9 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process Features of the Managed Portfolio Service The Experience of the Team Evaluate the Accessibility 9

10 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process Features of the Managed Portfolio Service The Experience of the Team Evaluate the Accessibility Service Support 10

11 Selecting a DFM Create a Long List Look at DFM Culture and Management The Investment Process Features of the Managed Portfolio Service The Experience of the Team Evaluate the Accessibility Service Support Fees 11

12 Our investment performance The percentage return data table shows our cumulative performance in the four main ARC categories over 1, 3, 5, 7,10 and 12 year periods, and rolling performance of 12 years. Percentage Return Data - S&W Index Cumulative Returns to 1 Year 3 Years 5 Years 7 Years 10 Years 12 Years 30 June 2016 % % % % % % Sterling Cautious Index Sterling Balanced Asset Index Sterling Steady Growth Index Sterling Equity Risk Index Discrete Years Ending June 2016 % % % % % % % % % % % % Sterling Cautious Index Sterling Balanced Asset Index Sterling Steady Growth Index Sterling Equity Risk Index Past performance is not a guide to future performance. Data supplied and independently assessed quarterly by Asset Risk Consultants Limited (ARC) this exercise is undertaken to assess riskadjusted performance of our portfolios submitted monthly, based on the proprietary ARC indicators. Please note that ARC figures are complex calculations based on averages and are not indicative of the future performance of any specific portfolio. See Important Information section. Source: Asset Risk Consultants PCI 12

13 Performance Portfolio profile Distribution Technology Risk score 3 months (%) 3 months Multi-Asset Composite Benchmark (%) 6 months (%) 6 months Multi-Asset Composite Benchmark (%) 1 Year (%) 1 Year Multi-Asset Composite Benchmark (%) 3 Year (%) 3 Year Multi-Asset Composite Benchmark (%) Since launch (%)* Since launch Multi-Asset Composite Benchmark (%) Defensive Defensive Income Balanced Income Balanced Growth Growth Dynamic Growth Source: Investment Management as at All figures total return only. * Launch date Benchmark: Multi- Asset Composite Benchmark. 13

14 Lead by example Example of a USP Example of an investment process Example of service and support 14

15 Position of FCA The FSA has stipulated in its Retail Distribution Review (RDR) that investment trusts should be included in the spectrum of retail investment products considered by independent advisers from 2013 Source: JP Morgan Investment Management, Investment Trusts: the case for consideration Spring

16 High profile managers Temple Bar Jupiter European Opportunities Pershing Square Holdings BlackRock World Mining Law Debenture Henderson European Focus Woodford Patient Capital Edinburgh Finsbury Growth & Income City Merchants High Yield Asian Total Return Alastair Mundy Alexander Darwall Bill Ackman Evy Hambro James Henderson John Bennett Neil Woodford Mark Barnett Nick Train Paul Causer & Paul Read Robin Parbrook 16

17 The structure in action % Edinburgh Investment NAV TR Edinburgh Investment Price TR IP Income Inc /10/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/ /06/ /09/ /12/ /03/2016 Edinburgh IT v Invesco Perpetual Income Source: Bloomberg, as at

18 MPS Investment process & research The MPS team The Process The Result Your Portfolio James Burns Head of Investment Companies Research Portfolio Construction Distribution Technology Risk Graded Tactical Asset Allocation Research 100% 90% 80% 70% 60% Genevra Banszky von Ambroz Open Ended Funds and Investment Companies Analyst David Amphlett-Lewis Head of Passive Research Security Selection Open Ended Funds Investment Companies Passives 50% 40% 30% 20% 10% 0% Defensive Defensive Income Balanced Income Balanced Growth Growth Dynamic Growth Alts - Property and alternatives Property - Property and alternatives Supported by a network of over 55 investment professionals responsible for investment research. Equities - Developing International Equities - Developed International Bonds - Government Equities - Developed UK Bonds - Index Linked Bonds - Corporate Cash Source: Investment Management and StatPro as at

19 Managed Portfolio Service (MPS) Available on Transact, Novia, Ascentric and Verbatim. Defensive 13.2% 6.5% 15.7% Balanced Income 19.0% 0.4% 13.3% Growth 28.2% 0.6% 11.4% 64.6% 67.4% 59.8% Defensive Income 17.3% 2.0% 9.1% Balanced Growth 21.0% 0.6% 12.6% Dynamic Growth 32.1% 1.0% 6.9% 71.6% 60.0% 65.8% Source: as at Passive OEIC / Unit Trust Closed Ended 19

20 Reporting and Support 20

21 Conclusion The drivers for growth Selecting a Discretionary Fund Manager (DFM) and Managed Portfolio Service (MPS) Performance reporting Lead by example - service & support 21

22 Appendices

23 Sales team Mickey Morrissey Partner t: e: Mickey joined in December 2012 as Head of UK IFA Sales and was appointed Head of Distribution in July In October 2015 Mickey was appointed Head of Retail Sales. He is responsible for growing intermediated sales into the DFM, Managed Portfolio Service and Pooled Fund business lines. Mickey is a partner of Investment Management LLP and is a Fellow of the Chartered Institute for Securities & Investment. Julian Polnik Senior Business Development Manager t: e: julian.polnik@smith.williamson.co.uk Julian joined Smith and Williamson Investment Management in November 2011 as Head of Broker Desk. Julian has a BA Honours degree in Politics and Social Psychology from Loughborough University and a Diploma in Management Studies from the University of Westminster. He is a Chartered Fellow of the Chartered Institute for Securities and Investment. Lucy Mitchell Associate Director t: e: lucy.mitchell@smith.williamson.co.uk For further information, please visit: Lucy joined in April 2015 as Associate Director primarily to develop further the Managed Portfolio Service via platforms as well as the Bespoke DFM offering for the intermediary market. Lucy graduated from the University of Birmingham with a BSc in Economics and Political Science. She has also completed the IMC and Investment Advice Diploma (IAD). 23

24 Important information Risk warnings Investment does involve risk. The value of investments can go down as well as up. The investor may not receive back in total the original amount invested. Past performance is not a guide to future performance. Rates of tax are those prevailing at the time and are subject to change without notice. Clients should always seek appropriate tax advice from their financial adviser before committing funds for investment. When investments are made in overseas securities, movements in exchange rates may have an effect on the value of that investment. The effect may be favourable or unfavourable. Investing in alternative assets involves higher risks than traditional investments and may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain. Investments in emerging markets may involve a higher element of risk due to political and economic instability and underdeveloped markets and systems. Please note that bond funds may not behave like direct investments in the underlying bonds themselves. By investing in bond funds the certainty of a fixed income for a fixed period with a fixed return of capital are lost. Shares in AIM companies are likely to be high risk and volatile. Their value, and the income arising from them, may go down as well as up, and there is the possibility that investors could lose their entire investment. Shares in an AIM company may be illiquid and it may be difficult or impossible to sell them. Investors should take independent investment and taxation advice regarding AIM investments and qualifying tax relief, which can be provided by. In relation to any guided architecture investment options, Investment Management (SWIM) is unable to assess or provide advice on the suitability of any product or service for individual circumstances. No consideration has been given to the suitability of any investment or service for the particular needs of any recipient. SWIM will not be responsible to any other person for providing the protections afforded to retail investors or for advising on any investment as a result of using this service. 24

25 Disclaimer This document contains information believed to be reliable but no guarantee, warranty or representation, express or implied, is given as to their accuracy or completeness. This is neither an offer nor a solicitation to buy or sell any investment referred to in this document. Smith & Williamson Investment Management documents may contain future statements which are based on our current opinions, expectations and projections. Investment Management does not undertake any obligation to update or revise any future statements. Actual results could differ materially from those anticipated. Appropriate advice should be taken before entering into transactions. No responsibility can be accepted for any loss arising from action taken or refrained from based on this publication. The officers, directors and employees of Smith & Williamson Investment Management, and affiliated companies and/or their officers, directors and employees may own or have positions in any investment mentioned herein or any investment related thereto and may trade in any such investment. Issued by Investment Management which is a trading name of Investment Management LLP. Authorised and regulated by the Financial Conduct Authority (LLP registration number is ). 25