AtomosJan 4 2023

Atomos to move smaller clients to MPS as part of review

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Atomos to move smaller clients to MPS as part of review
Haig Bathgate, head of investments at Atomos, said the firm’s view was that WTW will “do a better job” at selecting investments than a financial planner for smaller, less complicated clients

“The contact points and the person giving the advice mostly doesn’t change...There’s no suggestion that any investment manager is bypassed if there’s a requirement for bespoke implementation.

“The investment manager still manages the client relationship, suitability etc. It’s only if there are no bespoke requirements for the underlying client that it makes sense to use an MPS for smaller clients on cost grounds.“

On the MPS’s performance, Bathgate said historic performance “isn’t really relevant” as the wealth manager is plugging into a completely new investment engine from Willis Towers Watson.

“That’s really why we want to move as many people into the new solution as soon as possible - the WTW performance has been exceptional. That’s evidently the reason we selected them to partner with,” he explained.

WTW’s conservative model, one of six risk types, outperformed the IA Mixed Investments benchmark by 0.5 per cent over one year, 1.5 per cent over three years and 6.4 per cent over five years.

‘Other firms will go down similar route’

Atomos is currently undergoing a grassroots review of its services.

Bathgate said as a result, the way Atomos delivers its products will start to look “quite different”.

The investment boss said: “The consumer duty is coming over the hill very quickly. So we’ve been looking at how to serve smaller clients with not too many capital gains tax restrictions and similar risk profiles who are likely to achieve the same outcomes, in a tax-efficient manner.

“This is the default proposition. Of course, those clients with more bespoke requirements - such as intergenerational planning or capital gains tax - will need a different service, but for smaller clients this is the most task-efficient way to manage their investments.”

In the email to advisers sent towards the end of last month, Atomos said the new investment service will see clients benefit from “over 100 researchers and over 70 sustainable investment experts”.

Client’s investment objectives and risk category will not change, it added. The MPS invests in passive, semi-active and active funds with institutional fee classes.

A custody fee of 0.20 per cent per annum will be applied.

“Where a client’s fees may be increasing slightly we have been explicit within the client letters on what we estimate that increase will be,” the firm said.