The Scottish Widows Platform is now live for valuations in Dynamic Planner, the UK’s leading risk based financial planning system.

This new integration with the Scottish Widows Platform enables Dynamic Planner users to onboard and value new clients and existing clients in preparation for their client review or cashflow planning, and benefit from the new integration to seamlessly pull in the data at a time they want.

The integration will run alongside the existing Advance by Embark integration while Scottish Widows completes its migration of Advance clients to the Scottish Widows Platform, later this year.

Financial planning firms can now use Scottish Widows’ technology, powered by FNZ, and backed by Lloyds Banking Group, to access over a hundred fund managers, thousands of mutual funds, UK listed equities and Exchange Traded Assets within Dynamic Planner’s one system.

Chris Jones, Proposition Director at Dynamic Planner said: “The Scottish Widows Platform is now live for valuations in Dynamic Planner, and financial planners can begin to onboard and value clients ahead of Advance by Embark Platform closing. For a limited period of time, both integrations can be used. This is yet another example of our commitment to ensuring our users can support their clients throughout and deliver increasing value more efficiently.”

Ross Easton, Head of Platform Propositions at Embark Group said: “We’re pleased to have seamlessly integrated Dynamic Planner with the Scottish Widows Platform. This delivers against our aim to be the most connected platform in the market, Scottish Widows Platform now has bulk valuation coverage with the significant majority of UK CRMs.”

This latest integration is the continuation of Dynamic Planner’s commitment to solving industry wide inefficiencies, a strategy at the heart of the firm’s vision.

Not a Dynamic Planner user? Schedule a free no-obligation demo with a business consultant and experience the full functionality of Dynamic Planner.

By Bordier UK

The FCA has now published its final Consumer Duty rules, with a definitive implementation date set for July 2023.

There is now no excuse for adviser firms to have not begun their preparations, especially given that a firm’s board (or equivalent) must have agreed and signed off on their Consumer Duty implementation plans by 31 October 2022.

The FCA’s new outcomes-based approach focuses on ensuring adviser firms always put good consumer outcomes at the centre of their business and that they focus on the diverse needs of their customers at every stage. Included in the new rules is a new consumer principle, which is underpinned by four expected outcomes:

  1. Products and services: ‘Fit for purpose’ – Advisers should be recommending products and services that are clearly designed to meet the needs of the customer and their known objectives.
  2. Price and value: ‘Fair value’ – Advisers should ensure customers are paying an appropriate fee for the service provided and that they are getting value for money.
  3. Consumer understanding: Customers must be enabled to make informed decisions about products and services. This includes the timing of information, and how it is delivered.
  4. Consumer support: Customers are supported by the firm to realise their financial objectives and realise the benefits of products they buy. The support should be delivered by channels that the customer wants, not what the firm chooses.

‘Fit for purpose’

Whilst many advisers should now be aware of the incoming principle, they may not necessarily appreciate the greater governance requirements for ensuring the products and services they offer their clients meet the needs of the target market and, most importantly, work as expected.

Throughout the FCA’s review, they highlighted several areas of poor practice where customers could receive a poor outcome. One particular area was the recommendation of ‘products and services that are not fit for purpose in delivering the benefits that consumers reasonably expect, or are not appropriate for the consumers they are being targeted at and sold to’.

The higher expectations for adviser firms regarding ongoing suitability and expected client outcomes has shined a greater light on an adviser’s chosen investment solutions and whether those propositions truly support clients in achieving their financial objectives, particularly with regard to clients in drawdown.

Centralised propositions and Consumer Duty

The introduction of Consumer Duty has signalled just how important it is for a firm to have a robust governance process, documented in a clear and concise PROD document, demonstrating client segmentation and how the chosen investment propositions meet the needs and characteristics of their target market.

It is evident that a substantial proportion of adviser firms (just under 78% based on research from Aegon) have an established centralised investment proposition (CIP) for clients accumulating wealth. It may come as no surprise that many advisers are confident that their current CIPs meet many of the product governance requirements of the incoming Consumer Duty through existing processes as a result of PROD.

However, with over 60% of adviser assets on average linked to clients receiving retirement advice (according to research from NextWealth), it is surprising that only around 50% of firms have implemented a centralised retirement proposition (CRP). This begs the question as to whether an adviser’s current investment solution for clients in or nearing retirement is suitable and provides the right outcomes for clients drawing a regular income.

This is often reflected in adviser investment propositions, with at times minor variation between an adviser’s CIP and their solutions for clients in retirement – the same risk profile often kept for both, which may be appropriate but could have some short comings depending on the adviser’s chosen investment solution.

What the new consumer principle brings into focus is whether those accumulation strategies and the maintenance of a client’s risk profile, are now providing the right outcomes for clients who need to preserve capital and manage their stock market risk whilst taking a regular income.

A different approach needed

Creating a CRP can be challenging – as clients move from accumulation into decumulation, advisers have to deal with much more complicated decisions and associated risks. Drawdown is complex and there are many challenges of managing clients who are drawing a regular income, in particular, the management of sequencing risk.

These added complexities have been masked by a decade of strong market performance; as a result, some advisers have maintained a more traditional accumulation approach to clients in drawdown. This often entails retaining a client’s existing risk profile on reaching retirement, which may not be the best approach to meet the client’s required outcome.

The conversation around the risks in drawdown (sequencing risk included) needs to be reframed. Advisers should shift their focus from growth-driven accumulation to investment strategies that put capital preservation first for clients in retirement, who need to ensure their retirement provisions can meet their income needs throughout their retirement with reduced market volatility and without the timing of their withdrawals significantly impacting the size of their pot.

Sequencing risk remains one of the biggest dangers facing client portfolios in drawdown and recent market volatility should focus the minds of advisers on the impact it has on investments. Greater focus should, therefore, be placed on managing risk within the client’s portfolio to reduce the fluctuations in its value to ensure the impact of withdrawals is minimised. This can be achieved by assessing risk on a monthly basis (as opposed to an annual one) against specific ‘value at risk’ boundaries, a more forward-looking measure, to help assess potential max drawdowns.

A client’s investment objective in retirement is also likely to be fundamentally different – many switch their focus from investment returns, to maintaining a regular income and a smooth investment journey. This aspirational change could in turn alter the underlying asset allocation, expected return profile and the management of risk within their portfolio and should, therefore, be reflected accordingly.

Adopting an active risk management approach in decumulation, to ensure the level of risk within a client’s portfolio is not only appropriate but also proactively managed to help provide a smoother retirement journey for clients, is an ideal solution.

This dovetails with the consumer principle and is a prime example of meeting the needs of the client. This approach can also assist and provide assurance for advisers with their ongoing client suitability.

Not long left

Now that the final rules have been published, and with the new consumer principle due to come into practice next year, adviser firms should be looking at their investment propositions to identify any gaps in their existing processes and ensure that they are delivering good outcomes for their client – those in accumulation as well as decumulation.


Advisers using Dynamic Planner’s Risk Managed Decumulation Service (RMD) can now access the Garraway Decumulation Model Portfolio Service.

The portfolio is the first decumulation portfolio built specifically to meet Dynamic Planner’s RMD Standard. It has been created using Dynamic Planner’s leading risk-rated portfolio guidelines and assigned a risk rating of 5.

Chris Jones, Proposition Director, Dynamic Planner said: “We welcome Garraway to our Risk Managed Decumulation service, with their specialist capabilities in hedge and managed futures. Advisers and their clients will benefit hugely from being able to access the expertise and scale of an institutional manager via Dynamic Planner.

“Back in April 2020, we effectively launched our RMD service into the pandemic – a timely coincidence with the events of the past 18 months continuing to bring this area of advice to the fore. The system has prepared clients for shocks and falls in capital value such as this, and to date the model and Risk Profiled funds have performed within the parameters an investor was led to expect.”

Mark Harris, Garraway DFM’s CIO said: “Dynamic Planner is the market leading risk-based system in the planning and advice process. With our aim to create a decumulation portfolio that is truly fit for purpose for the whole advisory market, it made perfect sense to work with the Dynamic Planner team to build the portfolio from scratch rather than trying to use an existing solution designed to meet the needs of a different target market

“The result is a portfolio that uses uncorrelated funds, rather than complex derivatives, to better match retirement duration whilst achieving the joint requirements of capital preservation and minimising drawdown. Putting it another way, our back testing shows that an investor could have made fixed withdrawals totalling over £49,000 per annum from a £1 million in this portfolio over 5 years and still have £1 million left. Of course, past performance is not a reliable indicator of future performance.”

The Key Features of Dynamic Planner’s RMD Service:

  1. Focuses on monthly over annual risk.
  2. Allows fair comparison of fund performance and charges for decumulation solutions, by filtering on only suitable solutions first it avoids the temptation to use other solutions because of long-term unit price performance or lower chares.
  3. Reduces the impact of clients encashing units within their portfolio for less than they are worth.
  4. Works in tandem with Dynamic Planner cash flow empowering fund and solution selection to be based on what a client needs and when not just what the funds will pay.
  5. Same simple process as researching and recommending a Dynamic Planner risk profiled fund or risk target managed fund – costing advisers nothing extra in time, but adding all the value and reassurance they need that the client in decumulation has the best possible outcome.
  6. No uncomfortable shocks at a next annual review. The risk and return assumptions of the agreed solution will have performed as expected even when the client introduces sequence of returns risk.
  7. Peace of mind – for the adviser and the client in decumulation. They can have confidence – particularly during times of significant market volatility – that they are invested in the right solution at an agreed level of risk. A typical client in decumulation, most likely retirement, may not have any further opportunities to buy more units if their earning power, from their working life, is largely over.

A conversation with Ken Rayner, CEO of RSMR

As ESG (Environmental, Social and Governance) becomes a major theme in investor preferences and adviser-investor conversations, the regulatory pressure also continues to build, with the FCA now fully embedding climate considerations into their remit.

RSMR, whose Managed Portfolio Service (MPS) is now available in Dynamic Planner, has been assessing ESG factors in funds for more than 15 years. Their best fund ideas are included in their MPS, including their three RSMR Responsible portfolios. Here are three questions they come across a lot from advice businesses, and how they respond:

So, what’s the difference between ESG and responsible investing?

“It depends who you ask. Others may say ethical or sustainable investing and that range of terminology is a growing problem. In RSMR’s fund research, we take ESG to mean the widest range of environmental, social and governance risk factors that exist. We have always believed that ESG factors represent potential risks to all companies and as a result, they play a core part in all the funds we rate, whatever they’re called, with ESG integral to the due diligence process.”

How do you help with ESG suitability?

“Many advisers and investors want funds that go further – ESG+ if you like – but find suitability hard to achieve, given the growing number of ESG approaches and fund names on offer. Since 2012, we have been addressing this with our ‘Responsible’ fund rating and we launched our first Responsible portfolio in 2006. Each Responsible fund we rate must satisfy our rigorous process and meet the requirement to be categorised in one of the following four ESG areas: Ethical, Sustainable, Thematic and Impact.”

How do you help with the adviser-investor ESG conversation?

“We provide a range of information in our Research Hub that helps advisers have effective and informed ESG conversations with their clients, focused on improving transparency and investment outcomes. This includes information at the fund and fund group level, incorporated in fund profiles and fund factsheets. We have summarised our ESG services in the ‘Our Approach to ESG’ document. All our information is available free of charge to advice businesses in the ‘Research’ section at”

The three RSMR discretionary models [Cautious, Balanced and Dynamic] also recently joined the Dynamic Planner risk profiling service in November 2020 and are currently badged as Risk Profile 4, 5 and 7 respectively.

Capturing a client’s preferences

Having a repeatable conversation with clients about sustainable investing can be tricky, and regulation is coming. To help you address this, why not find out more about Dynamic Planner’s new sustainability questionnaire?

The sustainability questionnaire is a set of 15 questions, constructed using robust, psychometric techniques, enabling you to assess your client’s sustainability preferences across a wide range of motivating factors. The experience for your clients will be consistent across the board, using simple language they understand and with the ability to produce magazine-quality, client profile reports to download at the end of the process. This provides a solid base from which to have deeper conversations on their sustainability preferences as required.

Sustainable investing in Dynamic Planner – Learn more

[vc_row type=”in_container” full_screen_row_position=”middle” column_margin=”default” column_direction=”default” column_direction_tablet=”default” column_direction_phone=”default” scene_position=”center” text_color=”dark” text_align=”left” row_border_radius=”none” row_border_radius_applies=”bg” overlay_strength=”0.3″ gradient_direction=”left_to_right” shape_divider_position=”bottom” bg_image_animation=”none”][vc_column column_padding=”no-extra-padding” column_padding_tablet=”inherit” column_padding_phone=”inherit” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_shadow=”none” column_border_radius=”none” column_link_target=”_self” gradient_direction=”left_to_right” overlay_strength=”0.3″ width=”1/1″ tablet_width_inherit=”default” tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid” bg_image_animation=”none”][vc_column_text]Whether you feel good, bad or indifferent about it – video chat on platforms like Zoom very quickly became synonymous with wider events this year.

Media advertising soon caught up and the distinctive images were everywhere. That trend has inevitably crossed over into professional walks of life, including of course financial services.

Indeed, four in 10 industry professionals say they are now using video chat to help conduct new business at their firm. The finding is part of a June 2020 survey we conducted of a cross-section of Dynamic Planner users, responding to questions concerning new business they had conducted – with new and with existing clients – in four months from February to May this year.

Video chat was one of two key ways firms engaged with clients, in a first meeting for new business, with 40% revealing they used it. Respondents added that clients were comfortable with the platform, through using it socially in lockdown and said that the time savings professionally, through not having to travel to client homes for meetings, were huge.

One person wrote:

“Video conferencing has meant we can speak with a client in Belfast, Devon and Essex in the same day. Face-to-face would have taken a week.”

The most popular way to host a first meeting with clients this year, at 44%, was a telephone conversation, while 10% said they used email. Prior to a meeting, just over half, 51%, said telephone was how they initially communicated with a client – with a quarter, 25%, using email and 17% employing video chat in that scenario.

In an interview in late-March, Lee Whiteside, an adviser in the North West, revealed he first started using Zoom – in combination with Dynamic Planner – this year once lockdown began.

He said of the platform:

“You can share documents with the client and do pretty much everything you can face-to-face… and at the point of sale. It’s actually easier, in one way and a really good of working. You do start to think, ‘Why don’t I run my business like this all the time?’”

David Owen, of Lifetime Connect in Hertfordshire, commented in April:

“Hopefully, some advisers will embrace this change and carry on holding client meetings remotely in future. And once we start to get up to speed and move away from things like wet signatures, for example, we can be in a position to work more effectively.”

June’s survey of Dynamic Planner users ran to 21 questions and covered multiple issues around new business for firms.

Concerning barriers to new business, 42% answered that they were already running at capacity at their firm, while 20%, one in five, said they did not have time to pursue new business. 22% added that opportunities for new business were simply not there and 12% said they could not recruit enough people to meet the demand.

Compared to Q4 2019, the survey questioned, ‘How is your level of new business in 2020?’ 46%, nearly half, said their level of new business was lower, while a third, 33%, said it was the same and just over a fifth, 21%, said it had been higher this year.

Time, or a lack of it – despite us being more time-rich in many ways, working from home in lockdown – was a recurring issue.

The survey asked, ‘How much time does your new business process take, from initial contact to completion?’ Less than 3% said it was faster this year, while 38% revealed it was slower and 60% said it was the same. When asked to elaborate, ‘Why?’, respondents described delays with post and providers; collaboration among colleagues, hampered by people working in isolation remotely; and a lack of support from admin team members, who had been furloughed.

‘Why were clients and prospects getting in touch?’ Understandably, the top reason at 23% was market volatility, followed on 19% by a desire to get finances and life in order – and on 18% by income in retirement. 14% said that lockdown had given them time to really look at their finances, while 10% said lockdown had made them re-evaluate and had triggered their inquiry.

Lee Whiteside continued in March:

“Clients, of course, are worried at the moment. We’re seeing pretty significant losses, even in quite low risk portfolios. There’s no point avoiding client phone calls. It’s about reiterating messages and revisiting client objectives. It’s a reassurance piece as much as anything.”

Nick Ryan, with Yellow Bear Financial Consultancy in Buckinghamshire, said earlier this year:

“Of course, I’m not happy about the situation as their adviser and they’re not happy as clients. But I am pleased with how people have reacted – I don’t think I actually could have asked for a better reaction. Hopefully, that was down to the preparation work we have together done in readiness for this type of market fall-off.”

David Owen added of the crisis’ impact:

“Rather than disrupted, I would say it has actually enabled us as a business. We’ve not hit the pause button, we’ve carried on – just with a different rhythm and routine.”

What did our survey reveal? ‘10 learnings from advice firms successfully generating new business in the pandemic’. Download your copy of our guide here.[/vc_column_text][/vc_column][/vc_row]

If you have ever experienced real panic, brought on without warning, it is extremely unpleasant, to say the very least.

A suddenly increased heart rate. A horrible hot flush. You may quickly feel cold and begin to shake. In all, it is disorienting and difficult to focus.

How do you react in that moment, under such pressure? Panic, in a sense, is natural and rational – an overwhelming urge for flight. Of course, when emotions are at their most intense is the very moment you most need to take a breath and calmly fight against the situation you are facing.

At Dynamic Planner, we are renowned for risk profiling – risk profiling clients of advice firms; their existing portfolio; and their future investment solution, all on an ascending 1-10 scale, where one, of course, represents the lowest level of risk and 10 the highest.

Nothing ever stands still and, in our 17-year history, we have constantly strived to do things better and thus powerfully enable advice firms to secure the best possible outcome for their clients.

Back to the beginning. How do we help prevent firm’s clients panicking when they see the value of their investments plummet, as they did in March this year, during the height so far of market volatility as a result of the coronavirus crisis?

Of course, before you can begin to solve a problem, you first need to understand it, which is why in September 2019 we announced we were undertaking a new, government-sponsored, two-year behavioural science and investment study, in partnership with Henley Business School.

We already enjoy a close relationship with the International Capital Market Association Centre at Henley Business School, which co-authored the latest, psychometric attitude to risk questionnaire, which first went live in Dynamic Planner in February 2018.

This new study’s aim ultimately is to understand how investors behave when their investments fall in value – their instinctive reaction, the time it takes them to react and how improved communications and knowledge, from a professional financial adviser, can prevent detrimental reactions and ultimately lead to better investment outcomes.

We can now reveal its first findings and the result of research conducted with 610 respondents between 24 January 2020 and 31 March 2020.

Each participant or ‘investor’, so to speak, were shown hypothetical scenarios, where they had just experienced a market crash and a dramatic drop in the value of their investments.

Louis Williams, Head of Psychology and Behavioural Insights at Dynamic Planner, said: “Early findings show that, generally, those who had worked with a financial planner were more resilient; had higher levels of positive emotions and self-esteem; and were more confident in their abilities to manage their finances.”

Louis continued: “It might be the case that individuals with positive emotional attributes may be more likely to seek financial advice, rather than developing these qualities as a result of engaging with a financial planner. However, the evidence does demonstrate that there are important individual differences.

“However, when considering factors that may lead an individual to first seeking financial advice and having higher levels of resilience – such as age or wealth – we continue to observe the emotional well-being benefits of having experience with a financial planner.

“Such qualities of stability and resilience are what we hope to promote within investors in order to face periods of adversity with confidence.”

What was a typical conversation between financial advisers and their clients during this year’s crisis?


Research conducted with 610 respondents between 24 Jan 2020 – 31 Mar 2020. Purpose to encourage and equip financial planners to develop clients’ confidence, to better manage their money and be more resilient emotionally.

Respondents with previous experience of financial advice:

Respondents with no previous experience of financial advice:

Risk profiles [on ascending 1-10 risk scale] of respondents with previous experience of financial advice:

Risk profiles [on ascending 1-10 risk scale] of respondents with no previous experience of financial advice:

It has only been a few weeks since our last Updates post – but, already, Dynamic Planner is looking a little different!

First, as you may have seen in the industry press and across on our blog, we have launched a new range of multi asset indexes in partnership with MSCI.

Currently, investors and advisers are faced with a multitude of benchmarks self-selected by fund managers. But the absence of a risk-targeted benchmark makes the ability to compare funds on a like-for-like basis highly challenging.

The launch of the MSCI Multi Asset Indexes – Dynamic Planner Module aims to address this – making relevant, independent and risk-targeted benchmarks available.

The indexes track the underlying performance of Dynamic Planner’s asset and risk model going back to 30 September 2005 – enabling you to review and track the performance of funds against their Dynamic Planner risk profile.

You can use the indices in the Client Review process to compare the past performance of the client’s portfolio against the relevant index.

If you sign in to Dynamic Planner Elements, you can watch a short video from Chris Jones, Dynamic Planner’s Proposition Director, talking about the indices and how they can be used to improve client reviews. Note – if the video doesn’t immediately pop up, click the little announcement [megaphone] icon in the top right of your screen.

Finally this month, we have released a number of visual tweaks and improvements to the look and feel of Dynamic Planner to improve the consistency of navigation. As we look forward to supporting other processes within Dynamic Planner Elements, the new layout will give a more consistent approach across each part of our service.

We have also improved the experience using Dynamic Planner on tablets. You will notice the side navigation politely moving out of the way on your iPad or device if there isn’t enough room on screen.

We hope you find the enhancements a useful addition to Dynamic Planner. As always, your feedback as clients is vital to helping us continue to improve and enhance the service for you. Please leave any feedback you have, however small, in Dynamic Planner’s feedback portal. We do read it all! Thank you.

As ever, you can always contact our Client Success team on 0333 6000 500 or at with any queries or issues you have.

Dynamic Planner has launched a new range of Multi-Asset Indexes in partnership with MSCI – to transform the ability of investors and advisers to compare and understand the performance and risk profiles of funds and portfolios.

Currently, investors and advisers are faced with a multitude of benchmarks self-selected by fund managers. The absence of a risk-targeted benchmark makes the ability to compare funds on a like-for-like basis highly challenging.

The launch of the MSCI Multi-Asset Indexes – Dynamic Planner Module aims to address this – making relevant, independent and risk-targeted benchmarks available to investors and advice firms.

The indexes will track the underlying performance of Dynamic Planner’s asset and risk model going back to 30 September 2005 – enabling advisers and investors to review and track the performance of funds against the risk profile agreed in Dynamic Planner.

Ben Goss, Dynamic Planner CEO, said: “Over the last two years, the FCA’s Asset Management Market Study has brought to the fore the importance of demonstrating returns for the risk taken by the investor. Until now, there has not been a credible way in which to show this.

“We have worked with MSCI to fill this void and deliver this suite of independent, risk-targeted benchmarks to UK advice firms and investors.”

Dynamic Planner is one of the most widely used, risk-based financial planning systems in the UK and is used by thousands of advice firms and a range of financial institutions. MSCI has created this series of 10 indexes based on weightings provided by Dynamic Planner, so that they can be used as benchmarks to compare the performance of thousands of fund portfolios.

The indexes have been developed in conjunction with Dynamic Planner’s asset and risk model, now running successfully for almost a decade and a half, which has produced a set of model portfolios at an asset class level, optimized for one of 10 risk levels from low-risk to high-risk.

Ben Goss [pictured above] said: “The indexes will transform the way in which advisers and investors are able to review and track the performance of funds against a given risk profile. Currently, fund managers can choose and select their own benchmark from thousands of options. The problem with this, for investors, is that it makes it almost impossible for funds to be compared fairly on a like-for-like basis. The Dynamic Planner Indexes overlay a consistent framework that can be used to really get under the bonnet of a fund and properly understand its risk profile.”

He added: “Whether selecting funds or reviewing them, the indexes give people the ability to compare past performance against a benchmark commensurate to the end client’s risk profile in both graphical chart and numerical format. This is much more useful to both the adviser and the investor, than comparing against the UK’s largest 100 shares in a bull market or cash in a bear market.”

Steven Kowal, Executive Director Index Products at MSCI, said: “There has been a longstanding demand in the wealth market place for multi-asset class indexes that can serve as benchmarks for portfolios that are primarily risk rather than return-targeted.

“Sector and other peer-group averages can provide general guidance, but they can be too broad and not replicable. MSCI’s collaboration with Dynamic Planner, a recognised leader in fund risk profiling for the UK wealth community, aims to fill this void by offering these independent, daily indexes.”

Key features of the MSCI Multi-Asset Indexes – Dynamic Planner Module:

The Dynamic Planner – MSCI indexes represent another element of Dynamic Planner’s multi-million pound investment into its software, announced earlier this year.

Demonstrating the real value you add, as a professional advice firm, to clients is naturally something you are consistently keen to achieve. As their portfolios grow under your management, so do the fees they pay you.

There are many ways in which you and your firm can and will successfully already do that. Professional, personalised communication and reporting for clients, for example; a sleek portal for clients to digitally access latest performance on their pensions and investments; and a robust and compliant investment proposition to ensure a client’s portfolio is invested at a risk level in line with their risk profile.

Recommending suitable investment solutions for your clients is one thing – but how do you know those funds are among the most efficient and effective for that risk level? How do you complete that research?

An incomplete or inaccurate impression

There is an immediate issue. So much available information about fund performance relies upon the unit price on the day it is viewed. This can give an incomplete or inaccurate impression. While past performance – as the time-honoured small print goes – is not a guide to future returns, an analysis of a fund’s performance, relative to a relative benchmark and other relevant solutions, can be one indicator of how well a fund has been managed to date. To pinpoint other key indicators, many more measures and data points are required.

But is your time best spent completing such fund research? And how do you know your time is being best spent? More pertinently perhaps, what tools can and should you use to help?  Financial technology can pick up the load and complete this due diligence for you.

One such service, Dynamic Planner independently analyses the retail investment market, without bias or restriction each quarter. It flags its findings to users in the form of a simple badge attached to a fund. Okay. But how can you trust that? What exactly – in this instance – is Dynamic Planner looking at, when analysing a fund’s performance? Dynamic Planner analyses chiefly three things: the assets within a fund; consistency of performance; and a fund’s efficiency.

Three keys behind fund analysis

First, a fund’s assets. Dynamic Planner has a fantastic track record in this field and has been successful building and refining its asset allocation model since 2005 and the model’s launch. It maintains a database of more than 20,000 instruments and uses a 48-asset class framework to precisely understand a fund’s underlying assets.

Second, consistency of performance. Dynamic Planner’s team of analysts and investment professionals consider how close a fund fits the underlying assumptions of Dynamic Planner’s Asset Risk Model, in relation to an appropriately defined fund peer group.

Finally, efficiency. How well has a fund delivered performance in its own right – again in relation to an appropriately defined peer group?

Those questions are answered over a credible time period to eradicate potential short-term bias. Dynamic Planner’s Research logos are one of two: ‘Premium’ for funds with a five-year track record of success; and ‘Select’ for funds with at least a three-year track record of success.

Advice firms can rest assured that a Premium or Select badge is entirely objective and consistent – giving them a simple, easy and clear way of filtering out the noise, so to speak, of the latest, daily fund data and performance.

Further, your clients can rest easy that they are being recommended funds with historic performance proven independently by a credible third party and that performance analysis was entirely unbiased and in their best interests – no one else’s. Adding value. All good.

“You can quickly filter down your research [in Dynamic Planner] to Premium and Select rated funds, which we like,” said Laura Hutchings, a paraplanner at The Pension House in Northampton. “That’s what you want to recommend to clients: funds which have outperformed their peers… we nearly always recommend funds for clients, which are Premium and Select rated.”

Find out more about Dynamic Planner Research and Recommendations.

Read time: 5min

Something nearly always has to give in life. Unfortunately, for UK advice firms in the wake of increasing industry regulation, it appears to be their profit.

“We speak to firms all the time and anecdotally we hear that the demand for their services has never been greater and that they are doing very well, with revenue going up in the right direction,” said Mike Barrett, Consulting Director at financial services consultancy The Lang Cat. “However, the profit that these firms are generating is going the other way.”

Research from the Personal Investment Management and Financial Advice Association (PIMFA) identifies that in 2013 profit as a percentage of revenue for firms on average stood at more than 25 per cent. However, four short years later in 2017, that figure had starkly dropped to just over 15 per cent.

“We don’t know exactly what is driving that,” Mike Barrett continued. “But our perception is that it is regulatory cost. Firms today are not as efficient as they should be.”

Mike Barrett was speaking at a private press launch – for industry journalists – in London for the Dynamic Planner Client Review, which we were excited to launch at the beginning of June.

He delivered a short presentation to the room, but which was packed full of fantastic insight, research and hugely informed opinion on the problems most pressing for advice firms today, 18 months on from the introduction of MiFID II regulation.

It was a timely overlap of ideas. Our new Client Review has been produced directly in response to feedback we received when we asked firms 18 months ago, ‘What work worries keep you awake at night?’

Investment suitability for their clients around MiFID II – was their resounding answer.

“This is the role technology can play,” said Mike Barrett. “Firms are pretty confident when it comes to their customer proposition, but it’s about improving their service proposition – helping clients understand complexities when they have to and ultimately making firms more efficient.”

Mike Barrett continued: “In a previous life, if you had wanted to change a client out of a particular fund, you would have simply emailed, saying, ‘I would like to change you out of fund A to fund B for these reasons’. The client replies. The adviser makes the fund switch. Job done.

“MiFID now, however, has taken the legs away from that proposition.

“Instead of sending an email, the adviser has to complete a suitability report, a benefit analysis and send the client various documentation. It might not be the quantity of that documentation which is the killer for firms, but the fact that it has to all be personalised – and there has to be an assessment around that as well.”

The new Dynamic Planner Client Review dramatically reduces the time it takes for firms to complete reviews for clients.

“It’s saving us a tremendous amount of time – and I mean hours and hours per client,” said Nick Ryan of advice firm Yellow Bear Financial Consultancy, which has been trialling it since January 2019. “Dynamic Planner is way ahead of the pack with this.”

Chris Miller of advice firm Miller Associates added: “It’s a new document for a new process, which, because of MiFID II, advisers have to produce and go through now. Dynamic Planner is ahead of the game in financial services, making this available.”

Mike Barrett: “It’s no longer simply mail merging and blind copying in 20 clients. Every client must have a report around their objectives and an assessment has to be completed on top of that. If you have a large number of clients, MiFID has made that previous way of implementing your proposition unsustainable.”

Ensure suitability not lost in translation

The average age of a client in the UK today seeking advice is 57, Mike Barrett highlighted in his presentation. The average case size for a client is £150,000.

For people on the high street with less than that, but who are still keen to invest, securing professional advice from a firm might be difficult because, ultimately, serving them has become unprofitable, bringing us back to where we began.

On the flip side of the coin, more of us today would perhaps benefit significantly from sound professional financial advice.

The recent rise of the ‘slashie’ – or people who class themselves as having more than one job title – married to the fact that all of us can expect to experience more varied careers, which accumulate more than one pension, has seen to that.

“You can almost imagine a typical new client now walking into an advice firm, with a nice bag full of stuff saying, ‘Here you go financial planner. Here’s all the stuff I have accumulated over my life – all of my pensions – please sort it out’,” said Mike Barrett.

“The average age a millennial now can expect to inherit wealth is 60, 61 – so, soon, not only will a client have objectives concerning their own children, but they will have inter-generational wealth as well. So, yes, you do need good, professional financial planning to sort all of that out.”

The new Dynamic Planner Client Review has been 18 months in development and built in partnership with advice firms.

More than 100 firms were part of a special Early Adopter Programme we set up to help manage and encourage more granular feedback once advisers, paraplanners and administrators were able to use the Client Review in their everyday working practices.

That opportunity and collaborative way of working certainly appealed with advisers and was genuinely appreciated. The end result, either way, today is a service and software which is only more closely wedded to firms’ true needs.

Lee Whiteside of advice firm Plan4Life: “Quite often, companies will tick along and take your money each month, but there’s no new developments as such. With Dynamic Planner, it’s nice to see a company taking an active part in trying to help advisers.”

Mike Barrett: “The main challenge firms face today is, ‘How do I serve more clients?’ They have no issue getting more clients – they just want to do it more efficiently.”