PA ANALYSIS: It is time to reimagine the IFA / DFM relationship

Added 2nd June 2016

Growth in IFAs outsourcing investment services to DFMs continues apace or is indicative of ‘X’ or ‘Y’ have been common refrains across the trade press in recent months.

PA ANALYSIS: It is time to reimagine the IFA / DFM relationship

Indeed, Portfolio Adviser ran a story along such lines on Thursday.

But, while there is no doubt that both are true, there is perhaps a bigger point to be made – it is not just the IFA that has been affected by the change nor is it solely on their shoulders that the burden of responsibility should, or indeed, does lie.

Too often still, the question is asked, if the adviser gives up the investment side of things, what are they actually going to be charging for? While it is often said in jest, there is also a kernel of curiosity to it that belies a view that not all of the services offered are worth paying for.

Indeed, in the press release accompanying the census of Nucleus clients on which Portfolio Adviser’s latest story on the growth of DFM 'outsourcing', Barry Neilson, business development director at Nucleus said: ‘Increasing transparency around fees post-RDR means that many advisory firms will need to widen their client propositions, or risk coming under price pressure.

“With this in mind, the relationship between the adviser and the client has the potential to be more fragile from a remuneration point of view. It is therefore essential that firms ensure they don’t have weaknesses in any major elements of their propositions, so we would encourage advisers to carefully consider the risks attached to all significant forms of outsourcing.”

"While it may seem a semantic difference, the words are important to ensure that everybody is clear on what exactly they are paying for."

Kames Income Hub


Vincent McEntegart, manager of the Kames Diversified Monthly Income Fund, explains how he aims to deliver a stable and sustainable income of 5% p.a.*, paid monthly, by investing in a range of asset classes

Square Mile Research

Jupiter UK Special Situations
Jupiter UK Special Situations...

Talking Factsheets is a video service for users...

Visitor's Comments Add your comment

Add Your Comment

We won't publish your address

About Author

Geoff Candy

Group digital editor

Geoff Candy joined Portfolio Adviser as News Editor in May 2014. He has been a financial journalist and broadcaster since 2005 and, in that time has worked in both South Africa and the Netherlands, covering everything from high street retailers and construction companies to mining and insurance.



Investment Strategy




PA Emerging Markets 2017
PA Emerging Markets 2017

Tuesday 7 February
Bloomsbury Street Hotel, London

PA SRI 2017
PA SRI 2017

21 February 2017
Bloomsbury Street Hotel, London

PA Japan 2017
PA Japan 2017

Wednesday 8th March
Furniture Makers' Hall, London

PA Dublin 2017
PA Dublin 2017

Tuesday 14th March
Westbury Hotel, Dublin

Sponsored Content

Investment Strategy