Most platforms still do not offer investment trusts, despite the Association of Investment Companies revealing that “record numbers” of advisers bought investment trusts through platforms in 2014.
According to a 12-page report published by the AIC, there was a 23 per cent increase in purchases of investment trusts in the first quarter of 2014, reaching £106.8m, a record high compared with £87.1m last year.
But the AIC confirmed that some of the largest platforms – including Cofunds and Skandia – did not offer full access to investment trusts.
This is despite the FCA insisting that, as part of the RDR, if advisers are to remain independent, they need to be advising on the whole range of investment funds. They cannot do this if the platforms do not allow it.
Mickey Morrissey, head of UK IFA sales at Smith & Williamson, said all platforms should, therefore, offer investment trusts. He said: “Post RDR, adviser firms were told to consider all options to stay independent.
“The investment trust market can be big and complicated, and while they should consider investment trusts, it can be a lot of work for advisers. Sometimes they need a team and a research capability.”
Last year, Smith & Williamson put on Novia’s platform all its discretionary fund manager offerings, which use investment trusts. Mr Morrissey called this: “an outsourced solution”.
Asked if Cofunds would put investment trusts on its platform, Stephen Wynne-Jones, head of marketing at Cofunds, said: “Clients are saying they would like not-so-mainstream investments on Cofunds. These types of investments are in the planning mix for future development, but we have no timescales to confirm as yet.”
Gordon Bowden, director of Buckinghamshire-based Quainton Hills Financial Planning, said: “All platforms saw RDR coming and should offer investment trusts if offering a platform to IFAs. Most of my new business is through Transact and it offers them. I tend to use trusts for property, where closed-end funds have advantages.”
