Schroders claims to have found the first hard evidence of advisers ditching smaller clients as they overhaul their business models following the RDR.
The fund manager surveyed 328 investment advisers and found 14 per cent had formally asked clients to leave their practice in the past 12 months. Of those asked to leave, three quarters had a portfolio of less than £50,000.
Robin Stoakley, managing director for UK intermediary at Schroders, said: “We’re starting to see orphaned assets emerging.
“This is tangible evidence that there is an advice gap coming into the marketplace.”
Advisers have been warning for years of a step change in the way advice is provided due to the RDR, saying that the move from commission to fees would cut out clients with smaller sums to invest.
The survey demonstrated that advisers have been overhauling their business models with the effect that some clients are no longer served.
In addition, Schroders said 58 per cent of the advisers it surveyed have now segmented their client base by size, with a further 14 per cent saying they plan to do so.
Elsewhere, Mr Stoakley claimed the data gathered by the survey might indicate that the growth in passive investments may reach a “ceiling” in the near future.
“Last year half of advisers were looking at increasing passives – that’s now 25 per cent,” Mr Stoakley said.
He added that even those advisers still planning on adding to their passive investments generally did not foresee more than 25 per cent of their total client portfolios being invested this way.
Tracker funds registered record quarterly net inflows of more than £1bn in the third quarter of 2013, according to IMA data. Passive funds now account for 9.6 per cent of industry assets under management as assessed by the trade body.
Richard Romer-Lee, founder of research firm Square Mile Investment Consulting & Research, argued that the “ceiling” might not be as close as Schroders suggested. He pointed to US data that showed that 40 per cent of new money in the past 12 months went into index-tracking products.
Mr Romer-Lee added that the desire to drive down the total cost of investing for end clients could also continue to drive passive inflows.