2016年-FCA英国金融行为监管局_ms15_2_2_annex_1_9页_514kb

MS15/2.2: Annex 1 - Summary

Core Content

This document is an Interim Report from the Asset Management Market Study, published in November 2016. It outlines the stakeholder views on the Terms of Reference (ToR) of the market study, summarizing the key issues and concerns raised by respondents from various sectors, including asset managers, investment consultants, industry bodies, and consumer organizations.

Main Views and Key Information

1. Scope of the Market Study

• Product Scope: Respondents suggested including foreign-domiciled funds passporting into the UK, as they are part of the UK's competitive landscape. The study also expanded to include hedge funds, absolute return funds, and benchmarking and index data providers.
• Geographic Scope: The study focused on UK-based firms and UK investors, but also included retail investment products from foreign providers.
• Distribution Channels: Financial advisors, including wealth managers, independent financial advisors, and stockbrokers, were highlighted as important distribution intermediaries. Their role in influencing fees and investor choices was noted, and their impact on competition was acknowledged.

2. Value for Money

• Beyond Fees: Respondents emphasized that value for money should not be assessed solely on fees and charges, but should also consider risk, service, performance, suitability, flexibility, and innovation.
• Price Competition: While price competition is intense, fees are not always passed on to investors, and costs vary based on strategies and investor types.
• Investor Behavior: Investors are often influenced by past performance rather than cost. Institutional investors may lack incentives to demand value for money.
• Risk Awareness: There is concern that investors may not fully understand the risks they are taking, and that focus on returns may lead to neglect of risk management.

3. Investment Consultants

• Gatekeepers: Investment consultants are viewed as gatekeepers in the institutional asset management sector.
• Limited Competition: A small number of consultants exert significant influence, and limited competition may hinder asset manager innovation.
• Conflicts of Interest: There are concerns about conflicts of interest, especially when consultants move into fiduciary management or have financial ties with asset managers.
• Transparency and Feedback: Respondents called for greater transparency in how consultants rate managers and improved feedback mechanisms for asset managers.

4. Platforms

• Role in Distribution: Platforms are seen as key distribution channels for retail investments, and their influence on product recommendations is significant.
• Platform Competition: Including platform competition in the study is important to understand retail pricing and investor behavior.
• Charging Structures: Platforms often include distribution costs in their displayed fees, which may not be fully transparent.
• Benefits and Risks: Platforms can negotiate better prices and reduce set-up costs for new asset managers, but vertical integration may increase conflicts of interest.

5. Ancillary Service Providers

• Cost Control: Asset managers may not have the incentive to control ancillary service costs, especially if these services are not bundled.
• Competition and Cost: Ancillary service providers often compete on cost, which may lead to underinvestment in systems and controls.
• Third-Party Providers: The emergence of third-party service providers has been beneficial, but custodian costs for smaller firms remain high.
• Benchmarking and Index Data: These were identified as an important area for further study, particularly in relation to performance comparison.

6. Product Innovation and Regulatory Barriers

• Innovation: Examples of recent innovation include LDI strategies, diversified growth funds, and smart beta strategies.
• Regulatory Impact: Some regulations, such as AIFMD and UCITS V, were seen as barriers to entry for smaller asset managers due to increased compliance costs.
• Technology and Infrastructure: While FinTech initiatives like blockchain and big data are promising, technology adoption in the sector is limited.

7. Other Issues Raised

• Business Models: Some respondents supported a focus on profitability, while others argued that declining margins should not be a central concern.
• Active vs. Passive Strategies: It was emphasized that passive strategies are not always superior to active ones, and that performance and suitability should be considered alongside cost.
• Benchmarks: The independence and clarity of benchmarks are important for fair performance comparison.
• Investor Education: There is a call for greater investor education and access to financial advice to ensure effective competition and informed decision-making.

Conclusion

The responses provided valuable insights into the competitive dynamics, value for money, distribution channels, and regulatory environment of the UK asset management sector. These views have been integrated into the analysis and findings of the market study, contributing to a more comprehensive understanding of the industry.