Outsourcing key source of demand RDR

Almost half (45%) of investment trust directors believe most of the demand arising from RDR will come from wealth managers and advisers outsourcing portfolio management.

Outsourcing key source of demand RDR


Another 25% believe demand will come from self-directed private investors, while 24% think it will be from advisers who are directly managing their client portfolios.

The survey was conducted at the AIC’s conference for directors last week, where the majority of attendees (80%) believed that the impact of the legislation will be positive for investment trusts over the long term.

In terms of the beneficiaries of the demand created by RDR, almost two-thirds (65%) stated that the largest and most liquid investment companies will be the most likely to benefit, while 18% stated that the specialist/alternative space would gain the most from the changes.Generalist investment companies and VCT trusts are anticipated to be the lead benefactors by 10% and 2% of directors respectively, while 5% believe that benefits will be spread evenly across the sector.

Ian Sayers, director general, Association of Investment Companies (AIC) said: “We are positive about the impact that RDR will have on the investment company sector but of course it’s going to take time. Given the diversity of the sector, it is not surprising that there are a range of views on the impact and where demand will come from.

“The AIC has trained over 1,400 advisers in the last eighteen months and the feedback we’ve received is that advisers are not just interested in the large liquid generalists. We’ve seen a fair amount of interest in these generalist companies but advisers are also interested in the more specialist alternative asset classes like private equity, property and infrastructure. Advisers are aware that they need to demonstrate value to their clients and these alternative asset classes are a way of doing this.”




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