Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Brewins warns not to leave RDR pricing too late

3 Comments
Brewins warns not to leave RDR pricing too late

Brewin Dolphin’s head of research Matthew Butcher has warned that fund groups could lose out on business if they set their retail distribution review (RDR) pricing structures too high or too late.

Butcher (pictured|) told Wealth Manager that the group would look to increase its allocation to direct securities, guided by its internal research teams, and to passives if fund houses’ RDR pricing structures are unattractive.

He also anticipates that the open-ended funds industry may struggle to grow at the same pace it has done over the past few years.

‘Part of the reason for this is I think fund houses have been quite slow to launch RDR share classes,’ he said. ‘We are very mindful of the total costs to clients for our services and third parties, so in the event that fund pricing is too rich for us on 2 January 2013, we are likely to see increased direct investment in the market and we can cater for that.’

While a number of large fund groups are seeking late mover advantage, he said that Brewins will find it difficult to wait for RDR share classes that are launched in January 2013.

‘In the meantime, what do we do with new money? We will invest in ETFs where pricing is clearer. This is what we are leaning towards,’ he said, highlighting the firm’s internal direct equity and bond research teams.

He also stressed his concerns that advisers use passives appropriately and not simply to improve their margins.

Schroders, Cazenove, Invesco Perpetual, MAM Funds and Guinness Asset Management are among the fund groups that have launched RDR share classes ahead of the January 2013 deadline.

In January, Cazenove Capital Management, for example, set its X share class’s management fee for adviser clients on platforms at 0.75% for equity funds and 0.5% for its multi-manager range and waived its £1 million minimum.

Schroders’ Z share classes, which launched in October, have an annual management charge of 0.75%.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Brewin's Gutteridge: Yuan direction

Brewin's Gutteridge: Yuan direction

This week Brewin Dolphin's research head chats to Fidelity Asian Investment Directors Jenny Lee and Gary Monaghan about the big changes in China.

Play On the Road Challenge: horsing around on the polo pitch

On the Road Challenge: horsing around on the polo pitch

Libby Ashby takes to the polo pitch with Stuart Leigh-Davies from Redmayne-Bentley for an 'On the Road' challenge.

Brewin's Gutteridge: where Miton's Godber sees value

Brewin's Gutteridge: where Miton's Godber sees value

This week Brewin Dolphin's research head talks to George Godber, co-lead fund manager of the Miton UK Value Opportunities fund, about value investing.

Your Business: Cover Star Club

Profile: what tempted Brewin's Glasgow team over to Rathbones?

Profile: what tempted Brewin's Glasgow team over to Rathbones?

Rathbones’ Glasgow office has only been open for three months but the team, led by Angus Kerr, has already attracted new clients

Wealth Manager on Twitter