Alliance Trust CEO says RDR unlikely to boost investment trusts
The Chief Executive of Alliance Trust has warned that the retail distribution review (RDR) is likely to do little to boost demand for investment trusts.
The Chief Executive of Alliance Trust has warned that the retail distribution review (RDR) is likely to do little to boost demand for investment trusts.
The RDR, a product of the Financial Services Authority (FSA), the UK's financial services industry regulator, is changing the way in which UK financial advisors offer services to investors by boosting transparency and clarity. The changes are due to take place at the end of this year.
Katherine Garret-Cox, who was speaking at an Association of Investment Companies (AIC) roundtable, said: "In reality this is not going to be a panacea for the industry, in my humble opinion."
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The CEO said she believes that the RDA will not level the playing field between closed and open-ended funds, despite the FSA confirming its plan to put a ban on cash rebates - the payments made by providers to consumers through platform cash accounts.
However Garret-Cox also said that Alliance Trust, as the largest generalist investment trust, with a market cap of £2.0bn, was "well positioned" for the RDR and would be afforded the opportunity to gain traction under its rules.
The RDR aims to protect consumers of financial advice to ensure investors are receiving the correct advice for their individual situation.
Under the new measures, which the investment trust industry must have put in place by the end of December 2012, firms will have to adhere to a code of ethics, state whether they are independent or restricted and disclose and seperately charge clients for the services they receive.
NR
-
FTSE 100 hits record highs – why is it rising and will we see more gains?
Advice UK equities have been described as unloved for a long time but as the FTSE 100 hits new highs, we explain if now is the time to buy British.
By Marc Shoffman Published
-
How to invest in copper
It may be time to invest in copper as the red metal appears poised for a big jump. Dominic Frisby looks at what should investors should buy
By Dominic Frisby Published