River & Mercantile warns downturn is upon us

River & Mercantile warns downturn is upon us

Advisers should continue to prepare clients for a downturn in returns from equities, according to Mike Faulkner, chief executive of River and Mercantile.

Mr Faulkner's comments were contained in the quarterly trading update of River & Mercantile, which covered the three months to 30 September, a period prior to the current bout of market turbulence taking hold.

The company's assets under management (AUM) increased by 4.1 per cent to £35.4bn, of which included net inflows of £1.1bn.

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Mr Faulkner said: “We have been advising clients to prepare for a downturn, and it would appear this is at least to some degree upon us.

"This ability to guide clients on what conditions to expect is central to our strategy as a firm.

"The current weakness in markets will clearly impact absolute returns from our equities division, however the group is highly diversified and therefore the effect on our overall numbers will likely be more muted than it is for others.

"We are also well positioned to support our clients during these market conditions, given our ability to offer strategies that seek to manage these risks and even profit from them."

The company stated it earned £3.3m in performance fees during the quarter.