17th May 2013
This week has seen us busily totting up the scores for this quarter's Platforum Market Monitor. Each quarter, we review how adviser platforms have performed, taking into account costs, user feedback, growth momentum, AUA growth, financial strength and functionality. A few celebratory pints at EC4 are in order as Transact tops the Q2 Platforum Market Monitor, with Elevate and Sippcentre taking second and third place respectively. (That could be another platform categorisation – what would be the celebratory tipple of choice for each platform? Pints of lager at Transact; gin and tonics at Elevate; pints of bitter at Sippcentre?) Have a look at the top five scorers on our homepage.
When it comes to adviser feedback alone, Parmenion has taken top spot. Sample size is always an issue with the smaller platforms. They have fewer than 50 reviews so we leave it to advisers as to whether this presents a reliable picture – it's pretty consistent feedback so we're going with it. Transact and Nucleus take silver and bronze on the User Leaderboard, followed by True Potential then Novia. Any adviser can look at the detailed reviews on our User Leaderboard, which is the best way we have found to give you an impartial, expert, customer view about how each platform is doing. Nosey platforms or providers not allowed in here as there are some pretty genuine, candid reviews from advisers so we keep this behind closed doors.
In addition to a look at platforms, this quarter's Adviser Platform and Distribution Guide, to be published next week, takes a look at the world from the investment perspective too. Aside from mutual funds, the most common investment instruments advisers say they'll be including in client portfolios this year are cash (53%), bonds (42%) and investment trusts (41%). Listed securities have seen the most significant increase (10%) in propensity to use since last quarter, with over a third (37%) of advisers now saying they'll be included in client portfolios. And what investment strategies will they be using to manage these portfolios? Just under half of the advisers we talk to are using only insourced solutions (insourced model portfolios and bespoke fund picking, governed by an investment committee), while those who do outsource to a third party DFM or other partner are on average doing this for a little more than a quarter of their business today. We hear much talk on the virtues of outsourcing, particularly in light of advisers' growing desire to free up in-house resource for building and managing relationships with clients, but there is still nervousness around relinquishing client control, and uncertainty about how cost of outsourced solutions stack up against investment returns achieved.
Finally, the move to clean share classes gathers pace with more being added to platforms on a daily basis.
Good luck to everyone still on PIMS. I did manage to sneak myself off the boat on a tender on Thursday. Sadly, fantasies of a Man From Milk Tray/ James Bond episode were abandoned as I stepped on a rusty boat with an economist, three fund managers and some off-duty waiters. Hey ho. A girl can dream.
Have a lovely weekend everyone.