The need for independent financial advice on investments has been underlined by reports that some online investments providers may be accepting higher fees from funds companies, in return for marketing advantage.
Many funds are available through third-party distributors known as ‘platforms’, who attract new investment for the funds by distributing them, via IFAs, in return for a fee. Press reports have suggested that some platforms are providing additional ‘shelf space’ to certain fund managers, by featuring them on preferred lists, or providing them with higher visibility online.
The standard fee for such services is 0.25% but some platforms are allegedly receiving additional payments from funds managers that can take these payments to 0.4%.
The reports have emphasised that only financial planning advice from an independent source can properly measure funds performance and fees, and provide customers with a genuinely balanced view of a funds or investment product.
The need for good, objective funds analysis has never been greater. The number of underperforming investment funds (so-called ‘dog funds’) has risen rapidly due to the recent stockmarket slump and in March 2010 there were 90 such funds on the UK market, up from 77 in October 2009. Some of these funds were among the largest in the UK, by assets under management.
It is therefore essential to seek independent financial advice from a company with a fund analysis capability, which provides advice based on first-hand analysis of a fund’s investment weightings and an objective view of the quality of management of the fund.
Principle First offers a portfolio analysis service for those with existing funds investments, as well as analysis-driven independent financial advice on funds and the Principle First range of funds portfolios to suit all risk profiles.
You can obtain independent financial advice on funds and investments by making an investment enquiry online or by ringing freephone 0800 678 5929 now
