New Model Adviser - For professional financial planners

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.
6395.73 -23 0.36% 11:26

Outsourcing Investment: Why Scottsdale Consulting uses London & Capital

Outsourcing Investment: Why Scottsdale Consulting uses London & Capital

Mike Wilson, director of Scottsdale Consulting, uses London & Capital, mainly via a platform, to give clients access to the fund manager’s model portfolios.

Number of adviser clients using the service

40

Average portfolio size of adviser clients

£150,000

Minimum investment limit for clients using the service

£5,000

Derisking the business

Milton Keynes-based Scottsdale Consulting took the decision two-and-a-half years ago to start outsourcing clients to London & Capital.

‘It was really just to derisk the business,’ said Mike Wilson, director of Scottsdale. ‘There was a growing realisation that we didn’t have the systems in place to build portfolios and to constantly manage and rebalance them.

‘It felt a comfortable decision for me, although there were one or two advisers who at first felt they were losing something in terms of the value they were adding.’

Service and support

Scottsdale researched discretionary fund managers (DFMs) partly through reading about them and by using Capita Financial Software’s Synaptic database. ‘We also took recommendations from people we know,’ said Wilson. ‘It’s about service and support too, not just the numbers.’

Scottsdale also uses Quilters, Brewin Dolphin and Sanlam.

Wilson said London & Capital’s offering fitted particularly well on Novia, the wrap platform that Scottsdale used. ‘We can use its model portfolios and access them through the platform. It’s very simple. We’re using London & Capital for model portfolios rather than true discretionary [services].

‘Low-value clients who don’t need to be on a platform would be excluded, as well as more high-net-worth clients who want a personal relationship. But that still leaves the bulk of our clients,’ he said.

Review and appraisal

The firm is constantly monitoring its panel and receives a lot of requests from other DFMs for its business. ‘In terms of model portfolios, we are also looking at a very low-cost option with Vanguard,’ said Wilson.

‘DFMs similar to London & Capital are contacting us all the time, but as long as we continue to have a positive experience [with them] we will stay with them. At the moment, they haven’t let us down.’

LONDON & CAPITAL

FOR

Service
It is incredibly approachable. We’re not dealing with a call centre; I’m on first-name terms with the manager.

Fund range
It has a wide range of risk-rated funds right across the spectrum, so there’s no compromise for clients.

Performance
The results so far have been excellent: consistent and predictable. It’s as much about lack of downside. We don’t have too many awkward client meetings.

AGAINST

Pushing for new business
It is constantly pushing us to give it more business, although I can understand why.

Not used as a true DFM
We don’t use it as a true DFM, only for its model portfolio service. This is more our choice than being a negative.

Client relationships
Due to the fact we only use it for model portfolios, clients do not have a personal relationship with a fund manager, but again this is because of the way we use it.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.