Dynamic Planner, the UK’s leading risk based financial planning system, has analysed the data* of the 40% of the UK advice market it serves ahead of the anniversary of Consumer Duty.

In the past 12 months, Dynamic Planner has seen exponential growth in usage as its technology is increasingly adopted and utilised to solve the new demands and challenges faced by the industry. Advisers are now generating reports and undertaking reviews more frequently than ever before, with the number of reports created increasing by 100% year-on-year to over 100,000 a month in June. The demand for Annual Reviews and Cash Flow Reports has grown fastest.

Technology has enabled advisers to become more efficient, drastically reducing the time spent reviewing and creating reports: specifically for Dynamic Planner – 16 mins to generate a Review Report; 10 mins for Client Profile Reports; 19 mins for Recommendation Reports; and 28 mins for Cash Flow Reports.

Consumer Duty has put the spotlight on target markets and in the past 12 months, advisers have increasingly used the target market feature in Dynamic Planner, originally put in place to support PROD and MiFID but also aligned to Consumer Duty. Around 1 in 4 firms have now created target markets, with an average of 130 new target markets created every month. Since July 2023 over 1,500 target markets have been created with numbers peaking at the expected times of year in July 2023 ahead of the advent of Consumer Duty, followed by March ahead of the end of tax year; and November pre-Christmas. Year on year there has been a 44% increase in the number of firms using target markets for their recommendations.

In line with the 2021 FCA ‘Guidance for firms on the fair treatment of vulnerable customers’ further amplified under the lens of Consumer Duty, advice firms have completed over 5,000 of Dynamic Planner’s psychometric Financial Wellbeing Questionnaires (FWQ) with their clients over the past year. Dynamic Planner’s FWQ is designed in line with Consumer Duty and the algorithm of the FCA Financial Lives survey. It accurately assesses a client’s characteristics of vulnerability evaluating a client for ‘low’, ‘moderate’ or ‘high vulnerability’ in four areas: health, life events, resilience and capability.

Chris Jones, Chief Product Officer at Dynamic Planner said: “Consumer Duty brought sweeping change across the advice industry and over the past 12 months firms have been working hard to deliver on the guidance set out. We understand that any change or innovation takes time and we are determined to support our clients throughout to meet their objectives and help them to avoid harm.

“As with all new regulation, Consumer Duty has presented challenges and obstacles but the industry has and is overcoming them, with technology central to this success. Our analysis of how advice firms use Dynamic Planner to meet the new regulatory demands they face is a reassuring testimony to our ease of use and the quality of our users. They can rest assured that we will continue to innovate and align with the prevailing regulatory principles and changing requirements faced by the industry such as the Retirement Income Review, in both theirs and their clients’ best interests.”

Dynamic Planner, the UK’s leading risk based financial planning system, is now risk rating L&G’s Future World Global Opportunities Fund.

Managed by Colin Reedie, the award-winning L&G Future World Global Opportunities Fund is ranked No1 in its sector – IA Mixed Investment 20-60% Shares for its five-year performance. The fund follows a robust risk budgeting approach in portfolio construction and adopts an inherent conservative risk management culture. The fund invests in a wide range of assets, including equites and bonds, which meet Legal & General Investment Management long term sustainable investment criteria, based on environmental, social and governance factors.

On the independent and propriety 19 year Dynamic Planner Asset Risk Model the L&G Future World Global Opportunities Fund is a Risk Profile 5.

Yasmina Siadatan, Chief Revenue Officer, Dynamic Planner said: “L&G Future World Opportunities Fund is award-winning, with an interesting investment remit which incorporates L&G’s Climate Impact Pledge. Currently topping its sector for five year performance, we are pleased to be working closely with L&G to help match the fund to suitable investors through Dynamic Planner.

“There are now over 40 L&G solutions risk profiled with Dynamic Planner, meaning we take data direct from L&G to accurately risk assess the underlying holdings, institutional level research which is then available within the software to all our clients and their end investors through reports. We are delighted to welcome another L&G fund and further broaden out the choice of investment solutions and funds for our clients.”

Colin Reedie, Fund Manager and Head of Active Strategies, Legal & General Investment Management said: “We are living through remarkable times, both geopolitically and in financial markets. This creates prime investment opportunities that we have designed the L&G Global Ops fund to target. Our success is born out of a distinctive structure and process, underpinned by shrewd individual contributions to the team effort.”

Read to find more information about the fund on: https://fundcentres.lgim.com/en/uk/private-investors/fund-centre/Unit-Trust/Future-World-Sustainable-Opportunities-Fund/

Dynamic Planner, the UK’s leading risk based financial planning system, has made the first of several new key hires into its Customer Success and Marketing teams to continue to accelerate its growth and scale further.

Three new team members have joined: Will Dunwell, as Marketing Director to lead the Marketing team with more than 20 years of experience in scaling SaaS businesses to draw on; James O’Gara as Customer Success Director, with an extensive background in delivering positive outcomes for customers, joins having spent the past five years at Morningstar; and Neil Andrews, who joins as Customer Success Manager following eight years at Intelliflo, has spent 25 years in financial services and financial services technology.

The Customer Success Team will ensure a customer centric approach and build on trusted partnerships to ensure clients and their customers are achieving their goals – a critical driver of the success of Dynamic Planner. The Marketing Team will focus on executing growth campaigns, brand awareness and driving digital transformation.

Yasmina Siadatan, Chief Revenue Officer, Dynamic Planner said: “Dynamic Planner is now used by 40% of UK advice professionals and has risk profiled more than 2 million investors. We are proud to have built a market leading award-winning product which our clients tell us has been integral to meeting the demands of Consumer Duty.

“Our ambition is to continue to drive innovation in the UK financial planning market, and these new appointments will give us the firepower to make it happen. It’s an incredibly exciting time at Dynamic Planner and we are delighted to have James, Will and Neil on board. With their background and experience they will be a formidable addition to the team, ensuring that we have a strong customer-centric approach to our growth, that we fully understand our clients’ goals and that we communicate and listen in a meaningful way.”

Dynamic Planner, the UK’s leading risk based financial planning system, has added Omba’s Managed Portfolio Service (MPS) to its growing range of over 900 model portfolio solutions.

Omba MPS is aimed at advisers and designed to provide transparent, cost-effective and tax-efficient access to global and multi-asset managed portfolios. It consists of three ranges of investment options: Core, ESG and UK, with a total of eight portfolios all now risk profiled on Dynamic Planner.

The Omba MPS portfolios added to Dynamic Planner are:

Yasmina Siadatan, Chief Revenue Officer, Dynamic Planner said: “Model portfolios have seen significant growth in recent times driven by technology adoption and the increasing regulatory burden on advisers, whether MiFID2 or Consumer Duty.

“As a result we are working with an ever increasing number of MPS providers to ensure we deliver the full choice to our clients and theirs, with MPS solutions risk profiled on Dynamic Planner now totalling over 900. We welcome Omba’s Managed Portfolio Service in bringing advice firms even more choice when it comes to risk profiled MPS on Dynamic Planner.”

Co-Founder Mark Perchtold, Omba said: “We are excited to announce Dynamic Planner has risk profiled our Managed Portfolio Service (MPS). Since our inception in 2017, we have specialised in ETFs and our independence is what sets us apart.

“We believe having our MPS risk profiled on Dynamic Planner will provide enhanced choice to the UK adviser market as they strive to meet the dynamic and evolving needs of their client base.”

To find out more about Omba’s Model Portfolio Services, visit their website here

Dynamic Planner, the UK’s leading risk based financial planning system, has added a new level of granularity to researching and reviewing the performance of DFM model portfolios.

As part of Dynamic Planner’s continued expansion of its in Research capability, past performance for over 900 DFM MPS solutions currently risk profiled has been added and Dynamic Planner’s DFM MPS Report Service has launched. This in-depth reporting will be specifically focused on ensuring advice firms are fully equipped to deliver good outcomes for clients under Consumer Duty requirements, demonstrating the value received for the risks being taken when using model portfolios.

The DFM MPS Report Service will provide an extensive level of insight powered by Dynamic Planner’s 72-asset class risk model and the collection of full underlying funds holdings with performance data sourced directly from the portfolio manager. Calculations are referenced against a set of fully regulated multi-asset benchmarks, provided by MSCI, alongside the appropriate risk-adjusted peer group comparators in Dynamic Planner.

Chris Jones, Chief Proposition Officer, Dynamic Planner said: “Having launched our Single Strategy Mapped service earlier this year, we continue to evolve our research capabilities so that advisers have everything they need in one end to end journey. Adding past performance for DFM MPS and our new reporting service is the latest phase of this and will equip advice firms with deeper dive research, aiding target market selection and enabling them to really get under the bonnet of these solutions for client suitability. Any questions regarding structure, fees and other characteristics will be easily answered, and all within Dynamic Planner.

“Our asset risk model, and relationship with MSCI put us in a unique position to provide advice firms with the granular level of data needed to ensure they are fully equipped to deliver good outcomes for their clients, clearly demonstrating the value received for the risks being taken using model portfolios.”

The in-depth research considers key risk/reward characteristics, calibrated on both a forward and historic basis, alongside trend analysis of key ESG metrics of underlying fund holdings from over 67,000 mutual funds and ETFs via an API service. Traditional performance calculations are also complemented with more detailed financial ratios and rolling risk/reward metrics, based on a relative risk-adjusted peer basis for added target market relevance. All key facts on the underlying MPS fund charges, management fees, re-balancing frequency, investment objectives and approach are included, directly sourced from the portfolio managers.

Dynamic Planner also uniquely provides historical trend analysis of ESG risks for MPS solutions rather than just considering the latest snapshot of data. These reports are updated quarterly and downloadable from Dynamic Planner’s Research Hub.

by Dr Louis Williams, Head of Psychology and Behavioural Science

How do your clients interpret past performance? Is the information you provide valuable, or could it be leading them to make poor decisions?

Under the consumer understanding outcome of Consumer Duty, the FCA wants firms to support customers to make informed decisions by giving them the information they need, at the right time, in a way they can understand it. To support alignment with this outcome, we at Dynamic Planner wanted to find out how clients interpret the performance charts they are shown by their advisers.

Despite the requirement to include disclaimers to the contrary, research shows that past performance data is often relied on as a useful source of information for decision making1. This can lead to poor choices due to behavioural biases such as availability bias, where clients use information that comes to mind quickly, and recency bias, where clients assume that future events and trends will resemble recent experiences2.

Benchmarks are used in past performance charts to provide clients with a point of comparison, but little research has explored how these are used in making decisions, and whether they are or are not beneficial.

In collaboration with Mark Pittaccio (Quilter), Dr Eugene McSorley and Dr Rachel McCloy ( University of Reading), we conducted a research project to explore eye movements and decisions of experts and non-experts when interacting with past performance charts. A total of 60 participants took part in the study, and were categorised into three groups – students, clients, and experts – based on their background and experience.

Eye tracking technology monitors eye movements during decision-making processes, providing insight into how we process complex information before making a choice. Such techniques have been used across disciplines including sports, art, medicine and decision theory.

We used the technology to monitor the eye movements of participants while they viewed a range of charts depicting one year of hypothetical performance. Participants were fitted with an EyeLink II tracker headset, and answered questions for each graph about what they would do in the situation – would they stay invested? – and how they felt. They were also asked to estimate the maximum return and the return at the start of month nine to gauge their level of understanding.

We found that clients spent more time and made more fixations and visits to the last two months and the y-axis of performance charts than both experts and students – that is, they relied significantly more on recent performance to help with decisions.

They made even more visits to the last two months when they were provided with a benchmark, whether returns were positive or negative. The availability of a benchmark appears to be very important for clients, providing useful information on whether to remain invested and affecting their views on the future of their investments. However, paying too much attention to the benchmark and to recent performance can distort decisions.

A benchmark was helpful in reducing concerns when participants had achieved negative returns. However, if they had experienced positive returns, the inclusion of a benchmark reduced their propensity to remain invested. The presence of a benchmark also increased the complexity of the charts for non-experts, with both students and clients requiring more time to make a decision when a benchmark was shown.

Benchmarks and portfolio values are factual representations of what has actually happened, but they tend to be presented without context of the client’s own financial objectives or whether or not their financial plan is on track. This lack of context could lead to poor assumptions being made based on very recent performance.

The adviser’s skill is important to help make the information relevant to the client’s individual circumstances and help them resist the temptation to act on detrimental behavioural biases.

A personalised benchmark that demonstrates whether the client is ‘on track’ to achieve their objectives may be more appropriate than generic benchmarks. Further research can help us understand this and the effects of visual framing on clients’ interactions with past performance data.

Download the full report

Sources:

  1. N. Capon, G. J. Fitzsimons, & R. Alan Prince (1996). An individual level analysis of the mutual fund investment decision. Journal of financial services research, 10(1), 59-82.
  2. S. Diacon & J. Hasseldine (2007). Framing effects and risk perception: The effect of prior performance presentation format on investment fund choice. Journal of Economic Psychology, 28(1), 31-52; W. Bailey, A. Kumar & D. Ng (2011). Behavioural biases of mutual fund investors. Journal of financial economics, 102(1), 1-27.

By Ben Goss

Back in the late 1990s, I left my job to found an internet startup. I remember the sense of possibility at that time, the expectation that everything would change. And, 25 years on, so it has proved.

From banking to buying car insurance to planning a holiday, we do everything online, and increasingly on our mobiles. The pace of change has been unprecedented. New digital technologies such as mobile, AI and personalised content have the power to transform your business. Not tomorrow but today.

At Dynamic Planner, we’re focused on harnessing their full potential to scale your success. In the advice industry, we have our own megatrends. Consumer Duty requires ongoing servicing to be delivered to customers in return for ongoing fees. Capital is being invested at unprecedented levels and demand for advice is outstripping supply.

A two-year development. A 20-year dream

According to the FCA, 4 million people received advice in 2022, but 10 million could have benefited from it. We know from our research and conversations with you that you’re bullish about the opportunities. But we also know that there are some material challenges that stand in the way of your ability to create the capacity in your business that makes profitable growth possible.

Heavyweight engagement models that rely on formal ‘advice episodes’, with their accompanying compliance overhead, suck up time for advisers and clients alike. So, at Dynamic Planner we asked ourselves, what if we could change these for you? What if we could remove the blockers and create more capacity for you digitally?

Our latest innovation at Dynamic Planner is designed to help you scale your success with engaging financial planning that is valued by the client, and that is less work for your firm, not more.

We’ve been working on this development for the last two years, but it’s something we’ve dreamt about for 20: the idea of helping you put a financial plan in the palm of the client’s hand.

Your new app by Dynamic Planner

We want to help you enhance your digital provision in a Consumer Duty world and demonstrate the ongoing value of your services. We want to enable you to engage clients via a meaningful digital experience. And we want to create capacity in the advice process, to drive the productivity gains you’re looking for.

We’ve built the digital future of financial planning, Tram, your new app powered by Dynamic Planner.

It’s a clean canvas your business can white label and enables your clients to check that their financial plans are on track. It is somewhere they can feel reassured, supported, and special. They can read regular content which is targeted to them. And they can securely message you.

First thoughts from advisers and clients

During early trials of Tram, what have businesses like yours said? Here’s one adviser: “We’ve been really, really impressed. The app itself is aesthetically pleasing and has a premium feel. And the content is a real USP and sets it apart. It adds to our proposition and provides the client with a great experience.”

Consumers themselves, who have been granted early access, have said of Tram: “Clear, crisp, and simple. My information being available was seamless and easy to get to the point where I could get started. The biometric login was very helpful. Having access to the app means I don’t need to speak to my adviser as often. I can see myself checking this on a weekly basis.”

Exciting, to say the least.

I feel the same possibility now that I did back in the late 1990s. Technology is transforming financial advice and there is so much we can achieve. We look forward to working with you in the year ahead to help you maximise the value of Dynamic Planner, to your business and to your clients. I feel confident that together we can scale your success.

Tram, your new app by Dynamic Planner. Register your interest and as nears launch later this year, we’ll keep you on track with its progress.

Published 5th March

Speaking to over 700 financial planning professionals at the 12th annual Conference for Dynamic Planner, the UK’s leading risk based financial planning system, CEO Ben Goss said: “We live in the most extraordinary of times, the speed of change is unprecedented, and technology is driving this transformation.

“In the advice industry, we have our own megatrends. Consumer Duty requires ongoing servicing to be delivered to customers in return for ongoing fees. Capital is being invested at unprecedented levels and demand for advice outstrips supply in this country. In 2022, four million people received advice– but 10 million people wanted it.*

“We know from our research and conversations with organisations delivering wealth management and financial planning services they’re bullish about the opportunities this presents, but there are material challenges that stand in the way of creating the capacity that makes profitable growth possible. While there are blockers such as variable data quality and time-consuming compliance requirements, we also know that new digital technologies such as mobile, AI and personalised content have the power to transform the financial planning and advice industry – not tomorrow, but today.

“We asked ourselves, how could Dynamic Planner help the advice industry remove these blockers and create more capacity? What can we do to enable our clients to harness their full potential to scale their success? Today we are announcing key areas of innovation that will deliver just that.

“The first is accurate data, we now use the latest ‘low code technology’ in conjunction with continuously deepening integrations that are important to our clients, adding Salesforce, Zoho and Durrell, recently, with more to come. With these new data flows we’re proud to say that our clients delivered annual reviews to over 338,000 households in the last 12 months, and that across the whole of Dynamic Planner users now 80% of advisers produce reviews in 35 minutes or less, 20% complete them in less than five minutes.

“The next key area is ever faster and more accurate automated analysis. In the past year, we’ve introduced the ability to value DFM models in the review process and launched our Single Strategy Mapped service, designed to deepen the accuracy of risk analysis within Dynamic Planner. Today we are launching DFM performance reporting for client reviews. At launch we are providing performance across over 900 DFM portfolios from 53 providers meaning that annual reviews for clients holding DFMs is as efficient as those holding packaged products.

“And to revolutionise the digital customer experience, we are launching Tram™ – keeping your financial plan on track – our latest innovation designed to help organisations scale success with engaging financial planning that is immensely valued by their clients. We’ve been working on this development for the last two years, but it’s something we’ve dreamt about for 20: putting the financial plan in the palm of the hand.

“The Dynamic Planner System now has modules which cover a client dashboard, profiling, reviews, recommendations, cash flow planning, research and suitability as well as added deep capabilities in firm administration, MI and target market configuration integrated into the most widely used platforms and practice management systems.

“We’re leading the way with R&D spend in the financial planning space and as a Microsoft Gold Certified Partner we’re making use of the technologies in Microsoft Azure, including OpenAI, to innovate for the future. We’re curious about the possibilities for AI and hyper-personalised content in financial planning and we’ve taken the first steps on that journey.

“I feel the same sense of possibility today that I did in the late 90s as the Internet emerged. Technology is transforming financial advice and there is so much we can achieve. We want to help advice organisations to digitise in a Consumer Duty world and demonstrate the ongoing value of services. We want to enable firms to engage clients via a meaningful digital experience so they can attract their next generation. And we want to create capacity in the advice process to drive the productivity gains they are looking for. We’ve built the digital future of financial planning for the advice industry to use today.”

Published 5th March

Dynamic Planner, the UK’s leading risk-based financial planning system, has launched ‘Tram’, a brand-new digital engagement app white labelled to financial planning organisations and designed to keep customers engaged with their financial plan like never before.

Powered by Dynamic Planner, Tram – keeping your financial plan on track – does the following:

  1. Helps firms meet the needs of Consumer Duty and deliver ongoing value to support their ongoing service and fees;
  2. Delivers meaningful digital engagement which appeals not just to existing clients but also to the next generation of a firm’s clients and;
  3. Creates capacity for firms so that they can grow and scale their business.

Uniquely Tram tracks clients’ progress against their financial plan, goals and agreed risk level, provides daily valuations and delivers personalised content aligned to their target market. In line with Consumer Duty it places the outcomes the customer is looking for at the centre of the service. It is available for both Apple and Android phones. Tram offers end clients true digital engagement and is designed to ensure they feel special, gain reassurance from their adviser and want to return regularly to the app.

Ben Goss, CEO, Dynamic Planner said: “We have been working on the development of Tram for two years, but it is something I have dreamt of bringing to life since founding Dynamic Planner. The idea of putting the financial plan in the palm of your client’s hand so they can keep track and you can deliver value 24/7 – but with low marginal cost – is transformational.

“Transformational for your clients and their access to your help and advice, but also in terms of the cost to serve clients and the capacity it can put back into your business. With Consumer Duty shining a spotlight on adviser ongoing charges and demonstration of value, creating capacity in the financial advice process in order to scale is paramount. Tram will offer valuable time and efficiency advantages at scale to advisers, as well as an enhanced ability to attract and retain the next generation of clients.”

Tram harnesses the API technology on which the Dynamic Planner digital planning and advice platform is built and also takes advantage of the multiple integrations in place between the Dynamic Planner platform and relevant CRM/practice management systems, platforms providers, custodians and asset managers. It is white labelled so that advice firms can align the look and feel with their own brand, offering clients a seamless experience.

Ben Goss continued: “The world is now mobile led and financial services is consumed more than ever via apps. We’ve invested heavily in the UI to ensure that Tram is every bit as slick and appealing as the best of any apps already on your client’s phone. We have also blended our expertise around best practice behavioural finance with best practice design, creating an app clients will want to come back to.

“Tram literally puts you, the adviser, in the client’s pocket – it will strengthen the partnership between adviser and client, and powered by Dynamic Planner’s technology, it will drive the future of digital financial planning and advice.”

Tram is currently live with a number of advice organisations, with Dynamic Planner opening up usage to a wider group of early adopters post its annual conference.

The Dynamic Planner Investment Committee (IC) met on Tuesday 23 January, coincidentally called ‘Super Tuesday’ in the US state of New Hampshire, where the race for the White House began with primary elections for the Republican party nomination. In fact, elections are expected to cover around 60% of world GDP over the course of 2024, so plenty for investors to ponder should there be promises of unfunded tax cuts, more protectionism or increased fiscal profligacy. But no doubt the ‘re-match’ in the US will be the centre of global attention.

As the impact of higher energy and food prices has subsided, and supply chains for globally traded goods have normalised, headline rates of inflation have fallen significantly over the course of 2023, but remain much higher than Central Bank targets.

The IC reflected on the still high embedded inflation expectations and the current market fixation about what the US Fed plans to do next with interest rates (following its pause announcement in November). Premature expectations of early and deeper cuts have propelled the S&P 500 to record highs, whilst earnings growth, retail sales and industrial production levels have remained flat at best.

The global economy looks set to slow in 2024, as fiscal policy starts to drag on growth and higher interest rates weigh on household and business activity, with excess savings built up during the pandemic largely spent. By stripping away the impact of the massive fiscal stimulus measures, the likelihood was that the US economy has been in intermittent periods of recession during 2023.

The US and Global government bond yield curves remain inverted, and interest rate normalization is required as high non-transitory inflation expectations persist. With slow growth, lower tax revenue, eye-wateringly high government debt and fiscal deficits, and Central Banks unwinding their balance sheets with QT, there will be a rising supply of bond issuance at a time of declining investor sentiment / demand. Hence the curve is expected to steepen at the longer end, resulting in negative real bond returns into the foreseeable future. The risk of greater economic volatility and a potential global government debt crisis persists, despite recent market optimism.

The IC discussed the potential of AI (particularly generative AI tech) on productivity and employment, with echoes of a potential ‘dot.AI’ bubble, given the 25% concentration of the US stock market in the ‘Magnificent 7’ tech stocks. As AI will help drive robotics and accelerate onshoring, the implications of a diminishing competitive advantage for China and emerging markets were noted.

There were no changes made to this quarter’s capital market assumptions, which follows a consistent process of long-term analysis. In preparation for the annual strategic allocation review later in the year, the IC reviewed ongoing analysis of additional asset classes / risk factors to be potentially included in the model. It continues to ensure that the markets and instruments being used by our asset management clients are accurately represented in Dynamic Planner.

Read the full Q1 2024 analysis from the Dynamic Planner Investment Committee.