Research Tools - October 2012
Typically a research tool will ask for details relating to the client’s circumstances, and will source the range of products available to buy.
Most financial advisers will already be using research tools, and many are finding that they can produce an audit trail relating to the client purchase.
The tools have to be able to use correct criteria when assessing the needs of their clients, and they now have to adapt to be ready for the RDR. This includes catering for adviser charging and client specific analysis, and links to platforms.
However, there are concerns that some advisers might be becoming too dependent on the use of research tools, without scrutinising the methodologies used by the technology.
There are also issues about whether research tools will cover all the peculiarities of certain contracts, which could have an impact on the viability of the product being recommended.
Many advisers prefer just to use a single research tool, out of habit as much as anything else, but this can produce skews in assumptions, and technicalities that could in some instances distort the advice process.
Even if some advisers think they will be restricted post-RDR, they will still have to use research tools. If the adviser is selecting from a range of funds, they will still need to conduct proper research.
The most important thing to consider is that the use of research tools should be just one part of the advice process, and not the main focus. It is essential that advisers do not become too reliant on the technology, and avoid the important parts of advice.
Melanie Tringham is features editor for Financial Adviser
IN THIS REPORT
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The market for planning tools has become a battlefield as competitors scrap over the spoils
Product, fund and investment Research carried out by advisers post-RDR must adhere to strict regulatory guidelines
Research tools used by IFAs for the various products bought by clients often fall short of the mark