Paying for research remains a dilemma for 34 per cent of alternative investment managers, despite Mifid II rules set to kick in in just six months time.
A survey by the Alternative Investment Management Association has found a lack of clarity about Mifid II requirements relating to the cost and nature of services provided by brokers.
Of the two-thirds of asset managers to have reached a decision on how to pay for research four in five intend to charge investors, with the remaining fifth opting to absorb the costs in-house.
Mifid II requires companies to decide how they will report trades to the regulator.
The research reveals 75 per cent of firms intend to self-report to the regulator, while 50 per cent plan to delegate some of the responsibility to one of more brokers.
Half of alternative asset managers with offices outside the European Union confessed they intend to apply Mifid II best execution policies globally.
Jack Inglis, chief executive of Aima, said: ““Complying with Mifid II is a significant undertaking and understandably many members are needing to rely on the broker community to provide solutions.
"This survey shows not only that a substantial amount of uncertainty remains but also that the industry is working hard to meet the January 2018 deadline.
“Alternative asset managers face further increases in compliance costs and we will be working hard with members and regulators to ensure concerns are addressed, and avoid any fallout in six months’ time.”
Martin Bamford, chartered financial planner at Informed Choice, said: “I have no preference whether fund managers want to take onboard the costs or outsource them.
"The problem is that companies do not have much time to make up their minds, given Mifid II comes into force in just six months. Like everything other regulation to come out of Europe, a lack of clarity is the order of the day.”
dan.moore@ft.com
