What does 2023 have in store for advisers?

What does 2023 have in store for advisers?

Last year was eventful, to say the least, with the Ukraine war, the collapse of multiple UK governments, the "mini" Budget, a historic heatwave and the death of Queen Elizabeth.

Will 2023 be just as eventful? In the first episode of the year, FTAdviser deputy editor Damian Fantato is joined by reporters Sally Hickey, Jane Matthews, Sonia Rach and Ruby Hinchliffe to find out.

Hickey said bonds would be an area to keep an eye on from an investment perspective.

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She said: "Bonds are now pretty cheap. A lot of people are now highlighting the fact you can buy a bond for less than the redemption value, so you can make much more money from a bond in a very safe way and I think this might change the fortune of the 60/40 portfolio.

"I think we might start to see that portfolio work again and equities and bonds move in different directions, which might be quite comforting news for investors."

Matthews said the mortgage market could see short term pain but, due to the shortage of housing in the UK, this would end relatively quickly.

She said: "Landlords have seen their costs increase and it doesn't look like we will see much change on that front in the new year.

"There does seem to be an expectation that we will see further professionalisation in the sector in the new year. A lot of part time landlords are finding regulations too cumbersome and are expected to leave the market."

Rach said the consolidation market in the financial advice space would remain busy.

She said: "2023 will be different purely because we could see private equity firms exit the market.

"We are likely to see more of the same with some PE firms exiting as they come to the end of the investment period. The PE houses which wanted to enter have found their positions and those looking at it now are seeing that it is too competitive."

Rach cited the sale of Succession from a PE firm to Aviva as a possible example of this.

Hinchliffe said the looming implementation of the consumer duty could be felt by the sector, including by the platform market.

She said: "There has been a lot of focus from the FCA on trying to improve the transfer process. Being able to transfer from one platform to another is something that, if the FCA can see platforms making that really difficult when the consumer duty comes in, then you can imagine they are going to encounter far more trouble.

"The big thing with the consumer duty is you cannot really define foreseeable harm. It is a very open phrase and makes it easier for the FCA to come down hard on firms."

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