Advisers should be facing greater scrutiny over the fees they charge clients, according to John Chatfeild-Roberts, who manages the Merlin range of multi-manager funds at Jupiter.
Speaking at the fund house's annual investment dinner in London last night (25 April), he said there is a “battle for margin” between fund managers, platforms and advisers as a result of the reforming Retail Distribution Review (RDR) rules introduced five years ago.
Fees and profit margins charged by fund houses, such as Jupiter, have faced intense regulatory scrutiny in recent years, as the Financial Conduct Authority has pushed asset managers to reveal explicitly how much they charge investors, for what services, disclose previously hidden costs and justify those against often lacklustre performance.
But Mr Chatfield-Roberts thinks greater scrutiny should be levied at the the fees and margins achieved by advisers.
He said there is a "battle about margin, and fund managers are questioned, but so should advisers".
The fund manager was particularly scornful of intermediary firms that offer managed portfolio services (MPS).
He said such products are “just a way for advice firms to extract more money, to repair a business model that was damaged five years ago [when RDR came in]".
However the role currently held by Mr Chatfield-Roberts puts him in competition with the type of services he criticised.
Mr Chatfield-Roberts is a former chief investment officer at Jupiter. His current role is as manager of the Merlin range of multi-manager funds.
This involves selecting funds with his team for different investor risk appetites and priorities, and grouping them into funds of funds.
Managed portfolio services involve intermediaries selecting funds based on risk appetites and grouping them into portfolios, a similar function to that carried out by the Jupiter Merlin team.
Jason Hollands, managing director for business development and communications at Tilney, said his firm's managed portfolio service remains popular with investors, including advisers, and that its main benefit is it allows investors with a smaller pot of assets to access an investment portfolio service.
Tilney also run multi manager funds.
Elsewhere last night, Mr Chatfeild Roberts said he is currently bearish on the stock market.
Equity markets probably “peaked” in January, the Jupiter manager said, and higher US interest rates and the withdrawal of quantitative easing means there will be less liquidity in the system and this will push asset prices downwards.
David.Thorpe@ft.com
