Another challenge for the trust is: why would disretionary wealth managers choose what is essentially a multi-manager fund when that is exactly what they are entrusted to do by their clients?
Adrian Lowcock, investment director at Architas, observes that given its multi-manager model, the fund does some of the work that discretionary fund managers already do, making it a hard sell to that crowd.
“While it might work in models for the smaller portfolios, I would expect many DFMs to be making their own asset allocation decisions and to access many of the underlying managers directly,” says Lowcock.
Godfrey admits this is one of the main hurdles to DFMs getting on board, but while he is not banking on a huge amount of discretionary money coming on board – most is expected from retail customers and platforms – he does think there is a place for it.
AJ Bell’s Hughes agrees, saying the trust could have success if it differentiates itself from everything else on the market and avoids overlap in terms of the management styles.
“I think the way this has been put together, with the underlying five managers each having a focused sleeve of investment, may be enough for some wealth managers to see that as a differentiating factor.” he says.
Lowcock meanwhile, believes the fund could make an interesting core fund or starting place for investors and would suit being on platforms as the asset allocation approach is “clear, transparent and easy to articulate”.
He also expects, given the line-up of managers, that it would deliver over the medium and longer term.
Whether or not it will be different enough is yet to be seen, but you have to hand to Godfrey for attempting to break the mould.
As Godfrey says: “There has been nothing like this before so we are setting a precedent.”
