Iveagh ‘alarmed’ by adviser plans for risk-targeted portfolios


Investment firm Iveagh has expressed alarm at the suggestion that the majority of financial advisers are considering running their own risk-targeted portfolios.

Research carried out by the Guinness family-owned asset management firm shows 68 per cent of advisers would develop their own risk-targeted proposition or use platform-generated model portfolios, despite many conceding that they need education in this area.

Iveagh says it is “concerned” that these advisers could be putting too much investment responsibility on their plates or leaving too much in the hands of platforms.

A poll of 700 advisers reveals that 38 per cent intend to build their own risk-targeted portfolios while 30 per cent plan to use a platform-generated solution.

However, 39 per cent of respondents say they need help with this part of the market – with 15 per cent admitting that they do not know the difference between risk-targeted and risk-rated funds.

Iveagh chief executive Richard Ford says: “We are alarmed by the number of advisers who intend to develop their own risk-targeted portfolios or use a platform-generated solution.

“There is enormous skill and time involved in globally diversified asset allocation and managing forward-looking volatility targets, not to mention capital preservation techniques, and we are concerned that advisers may be taking on too much investment responsibility or putting too much faith in the hands of platforms .“

Some 16 per cent of advisers said they would prefer to source risk-targeted portfolios through a discretionary fund manager, 13 per cent want a partnership with two or more product providers and 3 per cent are happy with a relationship with just one provider.