Model portfolios – bringing transparency to the industry

by | Jul 8, 2020

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In the latest of a series of webinars, IFA Magazine invited a specialist panel to lift another bonnet and have a good look underneath – this time the topic was “Model portfolios – bringing transparency to the industry”.

Chaired by Jonathan Gamble (Asset Risk Consultants), the panel consisted of:

  • Wayne Bishop (King & Shaxson)
  • George Cliff (Clever Adviser)
  • Craig  Burgess (EBI Portfolios)
  • Ash Weston (8AM Global)
  • Tony Catt (Independent compliance consultant)

The session began with a look at Tony Catt’s recent report on the MPS solutions which are out there; to put it into context, Citywide have published analysis of 16 models – Tony’s report looks at more than 65.

He covers performance and risk comparisons, fee and return analysis and explores the investment process and due diligence.

After this brief introduction, the panel were asked what they think are the advantages of an MPS for both the advisor and the client.

In his report, Tony reviewed some of the panellists’ portfolios. The discussion moved to bring that analysis to life, as each described the approach they take in terms of active/passive: value/growth.

The panel discussed what makes their organisations different, and went on to examine the role of research in the development of MPS models.

They then highlighted some of the factors an IFA should consider when choosing an MPS Partner, touching on other topics such as the IFA trend to move away from advisory to discretionary management services, how they see the MPS markets evolving and which resources they supply to support IFAs.

The discussion expanded to cover the issue of Agent as Client, ratings the panel use, MPS charging structures and transparency.

For the last 20 minutes the panel was joined by Louise Jefferies of Gunner & Co, the leading business broker in the IFA, financial planning and wealth management space.

Louise addressed the issues of MPS as a major driver of M&A activity in the IFA marketplace, and discussed whether MPS is about delivering value to the client or AUM for the adviser.

She also shed light on the metrics that make advisers become attractive to a prospective buyer.

To wrap up, bearing in mind that ‘Brexit’ was the word of 2019, ‘Covid-19’ the word of 2020, the chair asked the panel for their word of 2021.

It was a lively, entertaining and informative session which is well worth a catch-up here.

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