Adviser firm Five Ways Financial Planning has launched a new centralised investment proposition in partnership with discretionary fund manager Parmenion.
Parmenion will manage funds on behalf of the adviser, however Five Ways will decide asset classes and recommendations. The CIP is built around adviser asset allocation models and their risk profiling tool.
Speaking to FTAdviser, Chris Gilchrist, director at Five Ways, said that one reason behind the partnership was that while there are other CIPs available, they do not allow advisers to influence the investment proposition.
Richard Goodall, head of distribution at Parmenion, added there was a governance process that the proposition can help advisers with, including creating, reviewing, administering and auditing investments.
Five Ways has an investment committee and now one member of Parmenion has joined it to help them make governance decisions.
Clients can now benefit from the adviser’s ability to make changes and rebalance portfolios when necessary, “without us having to seek prior approval”, Mr Gilchrist noted.
He said that an example of this was that if he really wanted a “big chunk” of absolute return as an asset class, they would now be able to allocate more when they wanted to. “We couldn’t find that anywhere else and now Parmenion is helping us to facilitate that.
“At Five Ways we pay a lot of attention to the quality and flexibility of our investment proposition as well as the systems we use to administer it. Efficient use of technology makes it easier for advisers to provide clients with timely advice, and frees them up to spend more time with clients.
Mr Gilchrist added that the benefits are less paperwork for clients and the “reassurance” that their portfolios remain in line with the risk profile that has been agreed with clients.
Mr Goodall envisaged that advisers who use this CIP will fall into three categories.
“First, those who really like to engage with clients and leave the asset allocation etc to Parmenion, second, those who are like Chris and want to be in partnership with us to grow their own proposition, and third those who have already have discretionary permissions and just want us to execute what they have determined to do.”
He added that the challenge is making all three available options clear to advisers.
donia.o’loughlin@ft.com
