Last week I attended Platforum ID: the investment distribution conference which took place in London. As you’d expect, it was well attended and had some excellent speakers.
I was invited to take part in a panel discussion entitled: How solutions are structured and what selectors are looking for. The session was chaired by Platforum’s Danby Bloch and alongside me were representatives from Tatton Investment Management and AJ Bell.
One of the topics under discussion was about evolution around investments. In my view, there are two key ones happening right now:
Advisers evolving to outsourcing investment work to professionals. I see this as being in the latter part of its development overall.
Professional managers evolving from a me-too MPS service to a mass-customisation (scalable bespoke) approach, which I believe is only just now starting to evolve, mainly due to the pressures of meeting regulations such as PROD, or Product Intervention and Product Governance Sourcebook, to give it its full name.
I am Spartacus (not)
On the topic of mass-customisation, it’s definitely a hot topic and one that many DFMs are trying to offer. I say ‘trying’ because there are very few who can actually claim to do it well (if at all). That’s not just my opinion.
Last week one of the PortfolioMetrix team met with an editor from a leading financial adviser publication and, when this topic came up, the editor said it was his view that there is an ‘I am Spartacus’ situation with DFMs and mass customisation. He says it seems everyone is saying they can do it but few are actually able to do so.
This isn’t particularly helpful as PortfolioMetrix is genuinely able to do this. It’s what we set the company to do back in 2010 and it’s only now that we’re seeing others trying to offer something that allows advisers to achieve the segmentation that PROD requires.
Shoe-horning in tech is a bad idea
The issue as I see it is that many DFMs are trying to shoe-horn technology to fit with their existing structures, which can be a bit of a recipe for disaster, or just plain ineffective.
The difference with PortfolioMetrix is that we set up our technology to do this from the get-go and we have a long track record that shows it really does work. Not only does it work well, it makes a huge difference to advisers who want to offer portfolios that truly meet the individual needs of their clients. So, we’re not Spartacus, but we do have a loyal following of adviser partners who are keen to stand up and tell others how happy they are to work with us.