Model Portfolios Supporting your investment proposition

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1 For Intermediary use only Model Portfolios Supporting your investment proposition June 2016 Debbie, Platform Proposition team

2 2 Model Portfolios Supporting your investment proposition Are you a looking for a platform that can help you build a flexible, scalable and suitable investment proposition for your client base? Alliance Trust Savings can help. You can access a range of Model Portfolios from Discretionary Fund Managers (DFMs) on the Alliance Trust Savings platform, or build your own Model Portfolios if you prefer. Comprehensive investment research, client risk assessment and portfolio rebalancing tools are also available to help provide all round support for you in meeting your client needs. DFM model portfolios Our DFM partners each have an excellent reputation for putting together model portfolios and managing them on an ongoing basis to meet a stated investment objective. Through the Alliance Trust Savings platform they can already access well over 4,000 investments for this purpose, and more are being added on an ongoing basis. These are our live DFM partners at May 2016 and we have five others already signed up to go live in the coming months. Vestra Wealth Tatton Morningstar Alliance Trust Savings 7IM PortfolioMetrix

3 Model Portfolios Supporting your investment proposition 3 Lowest Very Low Low Lowest Medium Medium High Medium Highest Medium High Very High Highest For each DFM s range of Model Portfolios, asset allocation and stock selection is managed by the DFM including ongoing rebalancing as required. Our partners each offer portfolios designed to meet different types of client need. You select which portfolio(s) are suitable for your client and keep this under review. Coming soon: You can access the Dynamic Planner Profiler tool from Distribution Technology through our platform, and the majority of our DFM Model Portfolios have been matched to the risk ratings produced by this tool. The Dynamic Planner Profiler tool lets you make a psychometric assessment of your client s willingness to take investment risk and also looks at your client s investment timeframe, capacity for risk and liquidity. It is intended as a starting point in your decision making process and of course should not be relied on in isolation.! DFM Sets portfolio risk parameters Sets appropriate asset allocation Selects the investments Keeps under review and manages regular rebalancing Adviser Matches portfolio to client based on their individual needs and circumstances Keeps the suitability and performance of that portfolio under review on the client s behalf Why might you consider using DFM Model Portfolios? Do you have the time and/or resources to look after your client s investments on a day to day basis, or would you prefer to focus on maintaining client relationships and deal with non-investment issues such as effective tax planning? Increasing regulation and the complexity and range of financial products makes looking after portfolios more time consuming. Are you able to perform the due diligence required by the FCA to manage your client s money, adjust asset allocation appropriately, but also to make sure it always fits with their attitude to risk and their goals? How well adapted are you in managing your client s money in the years towards retirement where your client may wish to start taking income and where your biggest requirement may be capital preservation? Are you confident that you have the expertise required to build a profitable portfolio? The strengths of DFMs DFMs are experienced and highly qualified investment professionals managing client money, who constantly monitor investment markets and performance. Portfolios are also managed and monitored within agreed risk parameters. Using a DFM can bring efficiency. DFMs typically have teams of analysts who meet with the underlying fund managers regularly, analyse investment funds in detail and have access to a wide range of investment solutions including OEICS, investment trusts, ETFs and individual stocks. A DFM can act swiftly to react to any situation and have the ability to take advantage of market opportunities.

4 4 Model Portfolios Supporting your investment proposition Building and managing your own portfolios If you prefer you can create and manage your own bespoke model portfolios, delivering the right setting for performance to match the goals and attitude to risk of your particular client bank. To help you in this we provide: Access to our asset selector, portfolio manager and x-ray tools, all provided by Morningstar. Functionality that quickly and easily lets you manage regular portfolio rebalancing. We collect our charges from cash in your client s account. So when you link your client to any model portfolio you must keep at least 1% of your client s investment aside in cash. Meaning they can be a maximum of 99% invested in the model portfolio.! When might you consider building your own Model Portfolios? Do you have expertise in analysing and identifying funds that offer the prospect of superior returns over time? Do you have the ability to develop a portfolio with a specific set of targets and objectives? Do you want the ability to create bespoke models in line with your clients tolerance for risk, expected return, income requirements, tax position and any preferences that need to be taken into account?

5 Model Portfolios Supporting your investment proposition 5 How to set up your own Model Portfolios You can easily create a new model or modify an existing model through the manage model portfolios functionality. Name your model. Select the accounts that you wish the model to be enabled for ie Stocks and Shares ISA or General Investment Account. Select the investments. Confirm the allocation percentage and tolerance percentage levels and save. Once you have saved you can then make the model active or modify it. You can allocate models to clients through the investor model portfolio maintenance functionality. The screens below bring up all of the models available for use including any created by DFM s that you have linked with. Any questions? adviser T: Calls may be recorded for training and security purposes. PO Box 164, 8 West Marketgait Dundee DD1 9YP e: advisersupport@ alliancetrust.co.uk

6 6 Model Portfolios Supporting your investment proposition About our DFM partners Our carefully selected DFM partners each have an excellent reputation for putting together model portfolios and managing them on an ongoing basis to meet a stated investment objective. For detail on the portfolios they offer, go to The biographies below were supplied to us by each partner and were correct at May IM 7IM was launched in 2002 by seven financial services professionals. The aim was to provide a company that made an institutional investment process and discipline available to individual clients, working in partnership with financial planners and advisers. We believed that retail clients deserved the same advantages that institutions enjoyed, including the management of risk, broad diversification, greater transparency in charges, cost reduction and superior client service. We recognised from the beginning that financial planning is essential to the financial wellbeing of clients. 7IM offers no in-house financial planning services. Our strategy has always been, and remains, to provide investment solutions to clients with a long term and robust financial plan. Today we manage money for a range of private investors, working in partnership with their professional advisers and have over 9 billion under management. All the while we are still pioneering and still innovating whilst listening to you to find out what you and your clients need. Tatton Tatton is a Discretionary Fund Manager, with just under 2.5bn under management. We are only available through UK-based independent financial advisers, and operate purely on retail platforms. Through this, we have become the largest on-platform only DFM in the country. We work exclusively with financial advisers so that they can ensure that the end client s needs and aspirations are addressed by them, allowing us to solely focus on taking care of their investments. This clear separation of responsibilities means that clients can feel comfortable that their investment portfolio is in very safe hands in the knowledge that our dedicated and experienced team of investment professionals focus does not waiver from their portfolios goals. Through our size, we can give your clients access to institutional arrangements not normally available to retail customers. Combining this with our unique approach to fund management, this leads to lower costs for us, and this saving we pass on to our clients. We can therefore state with confidence that this has led to our prices being amongst the most competitive available in the market. Vestra Since 2008, Vestra Wealth have been committed to offering clients a fresh approach to wealth management, with a service that is as individual as they are. By drawing together in-depth knowledge and experience from across the industry, we provide a flexible, bespoke service adapted to each of our clients needs. Our rigorous investment process means that we do not invest in anything in which we do not believe. We do not manufacture and sell in-house products and we do not have product sales targets. Our advice is aligned to nobody s interests but those of our clients. Our areas of expertise cover portfolio management services, financial planning, services for intermediaries and their clients and discretionary portfolio services for US-connected clients via our subsidiary Vestra US Wealth Management Limited. The partnership ethos of our business has allowed us to attract some of the best talent in our industry and draw together in-depth experience from multiple disciplines. We offer an experienced, personalised, flexible and direct approach to investment planning and management across multiple asset classes. Running through this approach is our core value of always putting client interests first.

7 Model Portfolios Supporting your investment proposition 7 Morningstar Morningstar Investment Management Europe provides a comprehensive range of discretionary portfolios aligned to a variety of risk profiles and investment objectives. Each portfolio benefits from Morningstar s expertise in asset allocation and manager selection. Income portfolios are intended to provide a stable income in the context of attractive riskadjusted returns. We provide realistic and risk-aligned income portfolios. Real Return portfolios are designed to deliver returns above inflation and increase the real worth of a client s capital. We do this by investing in an unconstrained, diversified portfolio of assets that are fundamentally undervalued, overlooked or underappreciated. Active portfolios use long-term strategic asset allocation for diversification. They span equities, fixed-income and alternative investments, providing exposure to a broad range of asset classes that can be weighted according to our expectations for risk and returns. Passive portfolios are the purest reflection of our asset-allocation strategy. Because of their straightforward composition, passive investments do not face the same possibility of investment style drift as vehicles under active management. Our portfolios are supported by access to Morningstar s risk tolerance questionnaire, regular detailed reports and a dedicated adviser support team. PortfolioMetrix PortfolioMetrix represents the culmination of years of work by experienced professionals who wanted to challenge the status quo of how portfolios are managed and delivered to private clients. Because the starting point was a blank piece of paper, much of what PortfolioMetrix does is unique and unconventional when compared to competitor propositions. PortfolioMetrix provides discretionary investment management services to leading financial advisers and private wealth managers. The business is designed to confer a material competitive advantage that places advisers at the forefront of developments in financial planning and wealth management. Our services are aimed at firms seeking a safe pair of hands to partner with, particularly those wanting to combine individualised advice with a scalable operating model.

8 Alliance Trust Savings Limited is a subsidiary of Alliance Trust PLC and is registered in Scotland No. SC 98767, registered office, PO Box 164, 8 West Marketgait, Dundee DD1 9YP; is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, firm reference number Alliance Trust Savings gives no financial or investment advice. ATS I B 0001