Tilney answers advisers’ low-cost prayers

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Tilney answers advisers’ low-cost prayers

Fund manager Tilney for Intermediaries claims to have an answer for advisers seeking low-cost investment without the drawbacks of traditional passive funds.

Early in the new year it will launch a range of risk-graded, low cost multi-asset funds using ‘smart beta’ passive funds.

These funds re-weight baskets of investments using criteria other than market capitalisation. These can include strategies which weight exposure on fundamental factors such as book value, dividends, earnings, cash flow and balance sheet strength.

Miles Robinson, head of Tilney for Intermediaries, said: “There’s a clear increase in demand from advisers for lower cost investment solutions, but many advisers also recognise there are significant drawbacks with traditional passive products, which leave their clients assets fully exposed to the risks of valuation bubbles and also losses in overall market downturns.”

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Ray Black, chartered financial planner and managing director of Sleaford-based IFA Money Minder Financial Services, said: “I am not a huge fan of passive strategies, and some multi-asset funds are expensive, so I am a bit sceptical. This new range appears to be more active than passive - if we are moving away from tracking an index and picking stocks then it is active – so it will be interesting to see the actual costs.”