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FundsNetwork unveils trust and ETP line-up

FundsNetwork unveils trust and ETP line-up

FundsNetwork has unveiled its new range of investment trusts and exchange-traded products, fulfilling a pledge to break ranks from competitors and host third-party investment trusts.

The Fidelity-owned fund supermarket has made 54 investment trusts and 76 ETPs available to clients through a number of wrappers. These include a range of leading providers, such as Aberdeen Asset Management, Baillie Gifford and JP Morgan Asset Management, as well as the five investment trusts from Fidelity.

FundsNetwork has also extended its range of exchange-traded funds and exchange-traded commodities with the addition of ETF Securities, HSBC, iShares and Vanguard.

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Pat Shea, head of FundsNetwork, said: “This initiative demonstrates our ongoing commitment to invest in the platform to meet the evolving needs of our advisers, helping them provide additional diversification for client portfolios.”

The extended range has been fully integrated with the existing range of services, and is available in the FundsNetwork Pension, Isa and investment fund accounts.

Dominic Clabby, head of UK IFA at Source, said: “We are delighted that FundsNetwork has expanded the range of ETFs now available on its platform and, in particular, including its first actively managed ETF.

“This ETF offers investors an alternative to cash, which may be attractive in today’s very low interest rate environment.

“The fund’s manager invests in a diversified portfolio of short-term securities, with the aim of generating income while maintaining a focus on security and liquidity. The fixed income space has been one of the areas where active management has delivered some good results.”

This move has marked a clear break from fund supermarket rivals Cofunds and Old Mutual Wealth, which have maintained there is low demand among clients for ETFs and investment trusts.

Cofunds claimed demand for ETFs and investment trusts was still very low, with less than 3 per cent of platform assets under administration being typical via these investment types.

Old Mutual Wealth took a similar stance on the importance of third party investment, although they did concede that this outlook may change.

However, Ian Sayers, chief executive of the Association of Investment Companies, argued that the demand for investment trusts has increased from both private investors and advisers, meaning FundNetwork’s additions represent a step in the right direction.

Mr Sayers added: “Since RDR, adviser platform purchases have trebled to approximately £600m a year, and the number of advisory firms recommending investment companies has more than doubled to over 1,000.”

Jaskarn Pawar, a financial adviser with Northampton-based Investor Profile, said: “Investment trusts are an important consideration in any investment strategy, but it comes down to the individual adviser and whether they have a preference for them or not.

“Our own view is that we don’t use investment trusts because they have a slightly different nature to unit trusts and Oeics, which make them slightly more complicated.”