FCA interim report into asset management in the UK.
Discussion
The FCA's interim report on asset management is, potentially, a life changing document for millions of savers and investors. And at the risk of seeming obsequious, The FCA should be proud of it. I hope other regulators across the world look to it. I just hope it's scope and reach doesn't get diluted as various commercial interests undoubtably, get to work on it.
It addresses investment platforms, active fund management, advisory practice, costs and charges, 'best buy' lists and the like.
https://www.fca.org.uk/publication/market-studies/...
It addresses investment platforms, active fund management, advisory practice, costs and charges, 'best buy' lists and the like.
https://www.fca.org.uk/publication/market-studies/...
I am interested to know why you think the FCA should be proud of it ? It's what they're supposed to do.
I'd have thought the fact that half of these investments seem to happen through Platforms of which one sector is totally dominated by one player (never good for the user/consumer) and many participants are loss making. Also interesting that they claim the introduction of RDR was kind of seminal moment for the Platform industry when one of the longest established platform's in the UK has been using that precise fee method for fifteen years.
What strikes me is that as with the GFC is 2008 they don't understand the business models of the participants in these markets. As I have already said Many Platforms are loss making and sub scale....these are deposit taking institutions holding cash on behalf of investors.
I wonder if its occurred to the FCA that one of the reasons that there is less competition in the Asset Management industry is because the onerous regulatory they have imposed. They have made it all but impossible for new entrants to come into the market.
I'd have thought the fact that half of these investments seem to happen through Platforms of which one sector is totally dominated by one player (never good for the user/consumer) and many participants are loss making. Also interesting that they claim the introduction of RDR was kind of seminal moment for the Platform industry when one of the longest established platform's in the UK has been using that precise fee method for fifteen years.
What strikes me is that as with the GFC is 2008 they don't understand the business models of the participants in these markets. As I have already said Many Platforms are loss making and sub scale....these are deposit taking institutions holding cash on behalf of investors.
I wonder if its occurred to the FCA that one of the reasons that there is less competition in the Asset Management industry is because the onerous regulatory they have imposed. They have made it all but impossible for new entrants to come into the market.
Cheib said:
What strikes me is that as with the GFC is 2008 they don't understand the business models of the participants in these markets. As I have already said Many Platforms are loss making and sub scale....these are deposit taking institutions holding cash on behalf of investors.
Platforms aren't banks which means client money is segregated from the firm's assets.I agree, it's what the regulator should be doing. It's still an effort to be proud of though, maybe we've become used to our expectations of this particular regulator being pretty low.
Platforms, themselves, aren't automatically bad. They can fulfil a useful purpose. If we see fund prices fall across the board, or if we see the subsidies that facilitate their usefulness, then they face an even more uncertain trickier future. At which point the financial services wheel will reinvent itself.
The regulator has launched Project Innovate, a means to encourage new thinking. Of course, the irony is, it is the regulator which originally stymied it - as you point out.
Platforms, themselves, aren't automatically bad. They can fulfil a useful purpose. If we see fund prices fall across the board, or if we see the subsidies that facilitate their usefulness, then they face an even more uncertain trickier future. At which point the financial services wheel will reinvent itself.
The regulator has launched Project Innovate, a means to encourage new thinking. Of course, the irony is, it is the regulator which originally stymied it - as you point out.
Ginge R said:
Platforms, themselves, aren't automatically bad. They can fulfil a useful purpose. If we see fund prices fall across the board, or if we see the subsidies that facilitate their usefulness, then they face an even more uncertain trickier future. At which point the financial services wheel will reinvent itself.
I think Platform's are the future...trouble is so do a lot of other people which is why there are so many and so many of them sub-scale participants who are loss making...that said plenty of the bigger ones are loss making too with their parent companies funding the growth in the hope of feeding business to them. Which kind of defeats the purpose...Cheib said:
I think Platform's are the future...trouble is so do a lot of other people which is why there are so many and so many of them sub-scale participants who are loss making...that said plenty of the bigger ones are loss making too with their parent companies funding the growth in the hope of feeding business to them. Which kind of defeats the purpose...
Choice of platform isn't a bad thing, choosing any platform for the wrong reasons though, is. I agree, financial security of your product provider is key.UK investment management is at a crossroads, this is going to be seen as a culminating point in the evolution of how people in the UK save and invest for their futures.
Ginge R said:
The FCA should be proud of it. I hope other regulators across the world look to it.
Hong Kong follows suit.http://www.sfc.hk/edistributionWeb/gateway/EN/cons...
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