Thesis Launches Bespoke DFM Service
Discretionary fund management business Thesis Asset Management is focusing on creating bespoke model portfolios in a bid to win new business
The product, known as Tracs (Thesis Research and Consultancy Services) was "soft launched" in November and offers advisers a white-labelled service they can offer their clients.
Regulatory responsibility of running the portfolios will stay with Thesis and the fee level on the bespoke service varies depending on the type of portfolio, with some advisers choosing an all passive range of funds, and so paying less than those who want a more complicated offering.
Thesis has assets under administration of about £15bn, divided between traditional model and discretionary services and wants the new product to contribute further growth.
Lawrence Cook, a director at Thesis, said increased regulatory obligations on advisers meant there was likely to be greater demand for outsourcing of the investment function in the coming years.
He said: "There are a lot of firms offering model portfolios.
"But one of the things we hear from advisers is that they don't want to lose ownership of the investment management process, so we white label the product.
"It carries their branding, and they can still chair the investment committee if they want, we can write the brochure for them, or they can write it."
Paul Stocks, an adviser at Dobson and Hodge in Doncaster, said: "We tend not to use discretionary fund managers or model portfolios.
"Proper discretionary fund managers should be about creating portfolios for individual clients, but it has moved in recent years towards models, where they group clients by risk profile, and that isn’t the same thing.
"In a previous job, they outsourced everything to DFMs and I used to wonder whether they were doing it the right way, creating individual portfolios for clients, or just doing models.
"For me, a model portfolio is just the same as a multi-asset fund, so we tend to do the multi-asset funds instead. I am very conscious of the total cost of investing, and if you are paying the adviser, the DFM and then the underlying investment cost, it mounts up."