We believe investors could be missing out by thousands of pounds if their wealth is tied up in platforms that don’t invest 100 per cent of their funds.
The common industry practice to ‘hold back’ two per cent of funds, to cover possible administration costs, is now ‘outdated’ and should be consigned to history.
The practice means an investor with a lump-sum of £100,000 could miss out on £5,000 over 20 years, compared to an investment where the full 100 per cent is invested.
At True Potential, we made changes to the operating structure of our Wealth Platform in May 2013, meaning customers can now place 100 per cent of their investments in the 12,000-plus products on the platform.
We think the move could force other fund providers – including fund supermarkets – to follow suit as client demand increases for ‘100 per cent invested’ schemes.
The funds benefiting from the change include the risk-rated strategies from SEI, Close Brothers Asset Management, 7IM, Allianz Global Investors and Cazenove Capital.
Our entire industry is based on the idea of growing people’s wealth by making it work for them. Some investments are at a two per cent disadvantage before they even start.
Clients now have the ability to improve their investment returns as there are solutions that will see 100 per cent of their money invested and we are seeing a great response to this.
Your capital is at risk. Investments can fluctuate in value and you may not get back the amount you invest. Past performance is not a guide to future performance. Tax rules can change at any time.