View the article online at http://citywire.co.uk/money/article/a990136
AJ Bell prepares passive funds push
Funds supermarket follows arch-rival Hargreaves Lansdown with plans to launch funds, although its will be ‘clean and competitive’ trackers.
The operator of the Youinvest investment platform, which is backed by a number of active fund managers including Neil Woodford, has announced it will launch a range of passive, index-tracking funds by the end of March.
Chief executive Andy Bell (pictured below) said the funds would be available by the end of March and would be a response to a highly critical report on the investment industry last year by the Financial Conduct Authority. The City watchdog attacked the opacity and high level of charges which contributed in large part to the widespread underperformance of many actively-managed investment funds.
‘The FCA asset management study shone a bright light on fund management fees and this is something we are looking at when developing our own funds,' Bell said.
‘The funds will certainly be priced very competitively but we are also looking at how we can get the charging structure as clean as possible so that it is easy for investors to understand as well as being great value.'
The new passive funds will be run by Ryan Hughes who joined AJ Bell from Apollo Multi-Asset Management last September.
The company first unveiled its ambitions last year, when it bought discretionary fund manager Mansard Capital and passive fund provider Indexx Markets. This was followed by the launch of a managed portfolio service aimed at the clients of financial advisers.
The passive funds will be available to both advised and execution-only clients.
In opting for index-trackers, AJ Bell is taking a different approach to Bristol-based Hargreaves which established a Multi-Manager ‘fund of funds' range before launching the active HL Select UK Shares fund run by Steve Clayton in December.
Despite the criticism of the FCA, Bell said the company would move into actively managed funds in future.
Becoming a funds provider was a natural extension of the platform business and an area where the company had seen demand from investors, he said.
The announcement came yesterday as AJ Bell, a privately-owned company not listed on the London Stock Exchange, published its results for the year to September 2016. These showed pre-tax profits up 8% from the previous year at £16.8 million with investor assets on its platforms leaping 29% to £23.3 billion.
News sponsored by:
Making the most out of Europe's potential means seeing things differently. Learn more about how BlackRock's focused approach to investing in Europe helps investors unlock the continent's vast potential.
In this guide to investment trusts, produced in association with Aberdeen Asset Management, we spoke to many of the leading experts in the field to find out more.
More about this:
More from us
- Watchdog proposes 'all-in fund fee' in scathing review
- AJ Bell makes play for pensioners with fee overhaul
- Is Woodford biting off more than he can chew?
- Hargreaves raises £168m for Clayton's equity fund
What others are saying
Tools from Citywire Money
From the Forums+ Start a new discussion
Weekly email from The Lolly
Get simple, easy ways to make more from your money. Just enter your email address below
An error occured while subscribing your email. Please try again later.
Thank you for registering for your weekly newsletter from The Lolly.
Keep an eye out for us in your inbox, and please add email@example.com to your safe senders list so we don't get junked.
by Daniel Grote on Mar 28, 2017 at 16:45