Multi-Manager Guide comes at an opportune time

Just as the FSA is raising doubts about the ability of some advisers to justify multi-manager selection, and with the industry in a state of flux, an independent updated guide designed to help financial advisers improve their understanding of multi-manager fund management has just been produced.

Called “Blending Talents: A guide to multi-manager investing in the UK”, Defaqto’s latest guide not only contains highly relevant information about the structure, benefits and information on the investment process itself, it also provides a methodology and is crammed with fund statistics to identify likely funds for further investigation.

The guide also comes at a time when the level of fund manager moves in this section of the industry is unprecedented as many fund management companies are positioning, or repositioning themselves in anticipation of further growth in what is becoming the managed solution of choice.

Defaqto believes that growth in multi-manger is being driven in part by the increasing availability of these funds in tax wrapped products. Recent research for Defaqto’s Retirement, Savings and Investment Report 2007, amongst a sample of IFAs, found that more than a quarter of premiums in personal pensions are directed towards multi-manager funds.

Defaqto expects the average number of fund links per personal pension product, currently standing at 101, up from 88 a year ago, to continue growing and for product providers to widen the choice of multi-manager funds available as a matter of priority.

Fraser Donaldson, Principal Consultant – Investments at Defaqto and author of Blending Talents, says: “It is no wonder that activity in the multi-manager arena is so high. Fund management companies see this growth continuing, so the unprecedented activity in the market is not unexpected. However, unless this activity settles down, and fortunately there are signs that it is, there is a real danger that the industry may be scoring an ‘own goal’ as confidence in fund manager tenure wavers.”

The guide is available as a free download from the Defaqto website at: defaqto.com