The number of advisers purchasing investment companies on platforms saw a 46 per cent slide last year, after the launch of Woodford Patient Capital caused a dramatic spike in the second quarter, figures reveal.
The Association of Investment Companies published data from Matrix Financial Clarity this morning (19 January), revealing that investment company purchases on adviser platforms reached £549m over the first three quarters of last year, up 55 per cent against the same period the year before.
The number of companies totalled £146m in the third quarter, the second highest quarter on record, up by more than 25 per cent compared with the same period in 2014.
In the second quarter of last year, purchases of investment companies spiked at £270.9m, partly driven by the launch of Woodford Patient Capital. As a result, third quarter investment company purchases were down 46 per cent on the second quarter.
The number of adviser and wealth management firms purchasing investment companies in the third quarter of 2015 was 1,009 - down on the Woodford-influenced second quarter of 1,119 - but still the second highest quarter on record.
Ian Sayers, chief executive of the AIC, said it was “very positive” to see such strong adviser demand for investment companies in the first nine months of 2015.
“We believe RDR has been an important reason behind this increase in investment company purchases, removing a source of bias and raising standards of advice.”
Total purchases of all products through adviser platforms decreased by 6 per cent in the third quarter to £25.3bn though, down from the record high of £26.8bn in the second quarter.
Net demand for investment companies in the third quarter last year was £70.5m, which Mr Sayers said has driven the Aic’s decision to provide more adviser training than ever.
It is currently running seminars on venture capital trusts, upgrading its online training and will also be launching a series of interactive workshops on investment companies this year.
The most popular sectors for adviser purchases in the third quarter of 2015 were global firms, at 19 per cent, followed by UK equity income at 14 per cent.
According to the Aic, this represents a return to the usual position, after the launch of Woodford Patient Capital made ‘UK All Companies’ the most popular sector in the second quarter last year.
In the first nine months of 2015, three platforms accounted for more than four-fifths of all purchases of investment companies. These were Transact at 47 per cent, Alliance Trust Savings at 19 per cent and Ascentric at 16 per cent.
katherine.denham@ft.com
