St James's Place  

SJP to increase passive offering in low-cost push

SJP to increase passive offering in low-cost push

St James’s Place is set to launch a low-cost range of passive-style funds to create high-capacity, low-carbon solutions for its clients.

The national advice firm is in the initial stages of launching its own range of “passive plus” funds which would be priced similarly to low-cost tracker funds but would not follow the index as precisely as standard passive products.

The fund range is expected to be available within the next 12 months.

SJP already has a small number of passive funds available to clients but is more well-known for its segregated mandates — run by active managers — within its own SJP-branded funds.

As first reported by FTAdviser’s sister paper, the Financial Times, the low-cost fund initiative is overseen by Rob Gardner who joined the FTSE 100 advice firm last year.

Mr Gardner told the FT the funds would be rules-based but have an active management overlay, meaning the range could be low cost but also benefit from having an active tilt.

He said the push was ultimately about client outcomes and that SJP’s key focus was to create high-capacity, low-carbon solutions” as part of a broader commitment to responsible investing.

Moving towards passive products with an environmental, social and governance element would help SJP capitalise on two of the biggest trends to hit the asset management sector over the past few years.

A more stringent focus on costs has seen investors pile into passive portfolios at the expense of active management, while growing environmental concerns have seen ESG products' popularity rocket.

Meanwhile the cost of the SJP’s advice services hit the headlines last year with reports of hefty advice and exit fees.

SJP’s competition in this segment has strengthened lately as Schroders Personal Wealth — a joint advice venture between fund manager Schroders and Lloyds Banking Group — has launched and set its sights on becoming a top three financial adviser.

Giant asset manager Vanguard, known for its lost cost products, is also set to join the advice industry as the fund house looks to meet the “changing needs” of its investors.

imogen.tew@ft.com

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