Discretionary Management  

Guide to Discretionary Fund Management

  • Describe the differences between multi-asset and model portfolios
  • Identify some of the key points of discretionary fund management
  • Describe some of the regulatory issues around model portfolios and investments
CPD
Approx.60min
Guide to Discretionary Fund Management

Introduction

Discretionary Fund Management has become a popular tool for many financial advisers who have to find efficient ways of making the right investment decisions for their clients.

Since the arrival of the RDR, advisers have to be clearer what their charges are for clients, and have less scope for researching the market in the way they used to.

There are also other regulatory initiatives, that force advisers to be clear to clients about how their investment is doing and how much they are getting paid for it.

One feature of discretionary fund management is the emergence of model portfolios, an off the shelf solution that is cheaper than the typical DFM.

Many compare them to multi-asset funds, and they have a different approach to investment choice and asset allocation, and may be less tax efficient than multi-asset funds.

Sustainability has moved up the agenda for many people, not just in the investment sector, and DFMs are the same as any other area.

So managers in charge of asset allocation are having to take sustainability factors into account, as the demand from investors increase.

This guide is worth an indicative 60 minutes

In this guide

CPD
Approx.60min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. Passive investments are considered to do well in a down market, according to Charlie Parker, true or false?

  2. What is Mifid II forcing advisers to do, according to Dave Baxter?

  3. What does the PFS warn advisers about with regards to DFMs?

  4. Why does Ricky Chan say model portfolio services are less tax efficient than multi-asset funds?

  5. According to Tom Sayers, passive investments lend themselves well to sustainable investing, true or false?

  6. According to Greg Mullins, which of the following is NOT an advantage that a model portfolio service have over multi-asset?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • Describe the differences between multi-asset and model portfolios
  • Identify some of the key points of discretionary fund management
  • Describe some of the regulatory issues around model portfolios and investments

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