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Quality of advice is better

The RDR has improved the quality of advice provided to clients, a survey by Investec Wealth and Investment has shown. Of 159 intermediaries surveyed in December, 43 per cent said it had improved.

However, when advisers were asked to rank the biggest challenges they have seen to their businesses since RDR, the costs incurred and maintaining levels of profitability were among the most popular response. Despite a focus on qualifications prior to the RDR, passing to QCF Level 4 was ranked the fifth biggest challenge.

Just 23 per cent of advisers have already increased – or plan to increase – the number of client portfolios outsourced to discretionary fund managers (DFMs), compared with just 3 per cent of advisers.

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But 53 per cent of those surveyed think increasing numbers of advisers are now outsourcing to DFMs, with 37 per cent claiming bespoke portfolio options are the most commonly selected, compared with just 24 per cent who favour other models.

Mark Stevens, head of intermediary services at Investec Wealth & Investment, said the overriding challenge of RDR had been the financial cost of changing business models.