Trustnet Magazine 59 February 2020 | Page 52

In the back INVESTMENT PLATFORM MODEL PORTFOLIO OFFERINGS – ADVENTUROUS GROWTH PORTFOLIO (OR EQUIVALENT) Platform AJ Bell Youinvest Bestinvest Charles Stanley Direct Service Format Ready-made Initial recommendation, portfolios self-managed ongoing Number of funds Annual costs** 7 funds – all actively managed UT/ OEICs £228.92 Ready-made Multi-manager portfolio 1 multi-manager portfolios – actively managed fund Foundation Portfolios £286 Initial recommendation, self-managed ongoing 5 funds – 4 actively managed UT/ OEICs and 1 index fund £224 £186.10 Hargreaves Lansdown Master Portfolios Initial recommendation, self-managed ongoing 7 funds – 6 actively managed UT/ OEICs and 1 index fund interactive investor Model portfolios Initial recommendation, self-managed ongoing 5 funds and 3 investment trusts £407.80 The Share Centre Multi- manager funds Multi-manager portfolio – actively managed One multi- manager fund £324 Data as at 22/01/2020. *Number of funds in adventurous portfolio. **ii cost based on investor plan of £9.99 per month. Annual costs are based on a single £20,000 investment within an ISA in the portfolios indicated TRUSTNET [ PLATFORMS & PENSIONS ] 52 / 53 Although a significant number of fund managers offer model portfolios or multi-manager funds, they are reluctant to sell them directly to the public But how many of these portfolios actually deliver what they promise? What is interesting is that although a significant number of fund managers offer model portfolios or multi-manager funds, they are reluctant to sell them directly to the public. Instead you have to rummage around on your platform of choice to see if you can find the good ones. Which offering works best? Lurking on the shelves of most fund First, let’s assess the credentials supermarkets are what are known as of the platforms offering these model portfolios. These baskets of services. Primarily, a platform is an funds have been curated by platforms investment administration service, to aid in the construction of a portfolio not a financial advisory firm. In to suit different types of investor. addition, they all claim (certainly They typically combine two key for these services) to be execution- factors – your appetite for risk and only, so they cannot offer any advice your time horizon – to create an off- as defined by the Financial Conduct the-peg portfolio. Authority (FCA). But there are other factors, too: some This has long been a bugbear of offer income and growth portfolios; the retail investment industry. Most others will start you off with a selection people need to be told what to do, as of funds, but won’t manage them going they have little confidence in their forward, leaving you to carry out the own investment abilities. rebalancing and fund switches yourself. These model-portfolio products are Some platforms have pretty supposed to help people who don’t sophisticated actively managed know which funds to pick and want portfolios, akin to a full discretionary a balanced portfolio that delivers on managed service, whereas others their needs. keep things simple with a small Unfortunately, as the regulator selection of goal-orientated funds. says you cannot offer personal The concept is to make it as easy advice unless you are an adviser, the to invest your money as if you were being advised by a professional. trustnet.com