The Financial Conduct Authority (FCA) will look at advisers’ relationships with discretionary fund managers (DFMs) in its retail distribution review (RDR) review later this year.
In its platform market study final report published this morning, the FCA said it will be looking at the ‘relationship between advice and discretionary services’ – an area the regulator has done very little work around since RDR.
The regulator also said its review of RDR will look at model portfolios, and the difficulty consumers have in comparing them, when the same name, such as a balanced portfolio, can mean different things across different platforms.
This makes it difficult for consumers to compare model portfolios across platforms, and so the FCA said it will be looking at this further in the RDR review.
‘While we are concerned about consumers’ difficulties in comparing model portfolios across platforms, recent regulatory change will improve the information available to investors who choose model portfolios constructed as funds,’ it said.
‘Taking this work into account, we do not think it is the right time to consider further remedies to standardise disclosure for these portfolios.
‘We will, however, be conducting a review of the outcomes of RDR and FAMR in the financial advice market during 2019. It will look at whether consumers can make informed decisions and, particularly, whether consumers can make informed choices between model portfolios across the retail investment sector.’