One vote more is enough for The Top Class Wednesday Update

See, I told you there would be lots going on in June. If you want next week’s lottery numbers just let me know. I’m like some kind of druid here. Speaking of which: obviously the TCWU isn’t the right place to discuss Tory politics – we’ve got Tom McPhail for that – but if I did a poll of all the lang cat’s clients and 40% of them said we sucked at our jobs then I venture to suggest I wouldn’t be taking that as an endorsement. If you did one and 40% of your clients said “actually, I’d rather have someone else looking after my money k thx bye” then neither would you.

It’s nice when lots of things happen because this email is much easier to write, and this week is a gift in that regard. We’ve got not one but two new MPS ranges hitting the market, and so that seems as good a theme as any into which to plunge.

I remember touring around with various footpads and vagabonds in 2018 and 2019 – prelapsarian days, siblings – talking about the impact of MiFID II on the administration of adviser-run models and what a basket case it all is. Mike had a funny slide about how much virgin Amazonian timber it took to print the hundreds of pages of total mince required as part of disclosure, and we enjoyed the look of beaten resignation on many faces as firms realised that yet again they were just there to get topped by the regulator, even if a lot of the MiFID II stuff wasn’t aimed at them.

(We may get a bonfire of MiFID II regulations yet, but don’t hold your breath.)

If you’d asked me then, not that you would have because it would have been a staggeringly boring topic of conversation, about what direction things would go, I’d have said that there would be a flight from adviser-run models to multi-asset funds. We’d have got over the single-line-of-stock issue, clients wouldn’t confuse complexity with suitability any more and we’d all get on with our lives.

In a reversal of druidic fortunes I think I’d have been wrong, and instead I think we’re seeing a flight to externally-run model portfolios. 38% of firms we surveyed recently said they were outsourcing in this way. Maybe these are the sweet spot – they do the diversified portfolio job, they aren’t available to D2C clients in the main, and they’re just sophisticated enough to make clients confident that their money is being taken seriously.

(If you want to see some research on all this, we’ve just contributed to a paper with Copia Capital on whether the CIP engine is overheating: free to download here).

Sweet spot or not, we’ve no shortage of models to look at, and to that list of hundreds of ranges we can now add new offerings from Aviva Investors and Vanguard. You couldn’t get two more mainstream names hopping aboard the MPS omnibus: this is not a fad.

A couple of quick observations on both of these. Aviva’s offering is tied into SimplyBiz and is aimed at decumulation. So that’s hitting a range of zeitgeist points right on the button. We don’t have pay-to-play marketing packages any more, but we do have “multi-year managed distribution partnerships”, so there’s that. It’s also only available on the Aviva Platform. So in one fell swoop we’ve got vertical integration, decumulation, MPS and strategic aligned distribution. Somewhere, a Big 4 consultant is getting extremely hot and bothered over a Powerpoint slide.

Vanguard’s LifeStrategy MPS is less zeitgeisty and is available on Transact, Aviva and Abrdn Wrap, but that doesn’t matter because it’s Vanguard and they can do exactly whatever they want. LifeStrategy is obviously a beast, and unless you have a problem with passives, Vanguard itself or the asset allocations then (judging by top sales on most of the platforms) your clients probably have some money in it. There’s just the single-line-of-stock issue, and that’s what this takes care of. It’s Vanguard’s world, kids, we just live in it…

So that’s another fun-filled week in June over. Can there possibly be more juice left in this most juicy of months? You’ll have to come back next week to find out… (or, you know, just read stuff on the internet).

#LANGCATLINKS

More McPhail: sorry about this, but the podcat’s most recent episode with pensions punk Henry Tapper is one of the very best so far and really deserves a bit of your time. Go listen here.
Good piece from yon Jack Gilbert here yesterday on CMCs and phoenixing. A scourge of our times.
And your music choice this week: well, I did say we couldn’t resist the metal for much longer. And so it is and shall be. I only recently discovered Sweden’s Evergrey, and I’m very glad I did. So do enjoy Blindfolded, and to be honest for the first two minutes 15 seconds of this ‘film’ you may wish that you were indeed blindfolded. The song’s great, but high concept metal videos…truly specialist stuff. Anyway, give it a go.

See you next week

Mark

YOLO, but for a long time hopefully

I’ve just finished reading a blog from Natalie Tuck at Pensions Age: YOLO vs retirement, which argues that ‘regardless of which generation you are born in, when you are young, you have other priorities than saving for retirement’. First up, I need to declare an interest: Alliance Trust Savings is one of my clients, so […]

YOLO, but for a long time hopefully

I’ve just finished reading a blog from Natalie Tuck at Pensions Age: YOLO vs retirement, which argues that ‘regardless of which generation you are born in, when you are young, you have other priorities than saving for retirement’. First up, I need to declare an interest: Alliance Trust Savings is one of my clients, so […]

Learning the language of risk

I recently spent a couple of days with one of our PR clients, Paul Resnik from FinaMetrica. For those who don’t know FinaMetrica, they specialise in helping financial advisers and their clients understand investment risk tolerance through tools and educational material. One of the things we discussed was the language of risk and the fact […]

Graham Greene gets insured fund economics

The first blog from me for a very, very long time. Once you get out the habit of this stuff it’s hard to get back into it. Never mind, here we are now. I know how you’ve all missed it, so much so that you’ve barely felt able to articulate how keenly you feel its […]

Graham Greene gets insured fund economics

The first blog from me for a very, very long time. Once you get out the habit of this stuff it’s hard to get back into it. Never mind, here we are now. I know how you’ve all missed it, so much so that you’ve barely felt able to articulate how keenly you feel its […]

A mini-series on charges

Mark Polson has been talking to Emma Wall at Morningstar on fund fees and the pension charge cap. As part of Morningstar’s ongoing ‘ask the expert’ video series. Your browser does not support HTML5 video. What are fund fees? What does the pension charge cap mean for you?

A mini-series on charges

Mark Polson has been talking to Emma Wall at Morningstar on fund fees and the pension charge cap. As part of Morningstar’s ongoing ‘ask the expert’ video series. Your browser does not support HTML5 video. What are fund fees? What does the pension charge cap mean for you?

Clean is the new dirty

Hello and welcome to the first lang cat blog of 2013. At least the first blog on this site, I,ve been doing some posting over on Adviser Lounge, which is worth a visit if you haven,t already. So the hot issue at the moment, now that RDR is here, is fund rebates and their wily […]

GC12-06 – The Little Paper That Makes A Big Difference

Back in the mists of last August, I mentioned the FSA Says, We’re Rubber, You’re Glue, It Bounces Off Us And Sticks To You! here that the FSA were looking newly buffed and getting punchy with the industry, right there in print. That buffing is reaffirmed in their latest exocet, Guidance Consultation 12-06, which came […]

Impact of poor service

/ White papers

The Impact of Poor Service

We provided the research for a report, in conjunction with Parmenion, which reveals how far short of expectations many adviser platforms are falling. The research found that over the last 12 months, 88% of advisers needed to apologise to at least one of their clients on behalf of a platform, and that poor service delivery from platforms impacts 91% of advisers every day.

Impact of poor service

/ White papers

The Impact of Poor Platform Service

We provided the research for a report, in conjunction with Parmenion, which reveals how far short of expectations many adviser platforms are falling. The research found that over the last 12 months, 88% of advisers needed to apologise to at least one of their clients on behalf of a platform, and that poor service delivery from platforms impacts 91% of advisers every day.

/ White papers

Answering the Call

Service means a lot of things to a lot of different people. It’s so subjective it can be hard to put your finger on. This paper aims to challenge the status quo and inertia that’s built up in the sector for many years.