Stuart Fowler - professional investor and finance author
Anyone trying to sort sense from nonsense in a seriously conflicted financial services industry
Wealth management & planning for individuals
Workshops for individuals and employee groups
So says Pauline Skypala of the FT in a nice article about No Monkey Business today. We don't mind if other financial advisers don't follow our wealth management model as long as there are qualified investors who fit our business and who value what we offer in our patch of wilderness: no conflicts of interest and no cross subsidy between clients - both realised by breaking the link between fees and asset values.
admin on 10.30.06 @ 06:41 PM GMT [">link]
Thursday's despatch box spat between Brown and Osborne (the 'effing' word, thrown papers) was prompted by John Redwood daring to suggest (as part of his deregulation thought-leading role in the Conservative Party) that financial services consumers might be better off with lighter regulation or even an opt-out for riskier products. The Chancellor's reposte was typical despatch box posturing: the Tories plan to abolish all consumer protection on pensions, mortgages, insurance and credit cards.
Grow up, boys. Four items posted in the last two months focus on the serious problem in the business of cost-effective advice. The head of the FSA tells the industry its economic model for the distribution of long-term savings product is broke. The head of the ABI nonetheless insists that competition between providers for consumers' choice will be just as low cost a way to go for the new National Pensions Savings Scheme as centralised, non-branded collection and public tender behind the scenes for the fund management. The industry just does not get the connection between the costs of competitive choice and 'active management' - a key message from our analysis of one of the top performing UK unit trusts. And 'Lambda' model builders Chris and Stuart propose a solution that recognises that a separate advice market is an unaffordable luxury.
admin on 10.28.06 @ 01:06 PM GMT [link]
In January we posted a copy of the quarterly market commentary sent to wealth management clients of No Monkey Business Limited. We repeat the exercise here. The focus is on the risks facing financial markets in the late stages of an unusually long expansionary phase of the business cycle. These are conditions in which investors with low risk aversion can still make good short-term returns but unwary investors with lower risk aversion tend to get caught out with excessively risky exposures when the cycle turns. And the timing is never predictable. If you thought the business cycle had been condemned to the history books and that monetary and fiscal authorities are working in sophisticated harmony to ensure well-balanced growth, you might find these ideas challenging.
admin on 10.26.06 @ 03:33 PM GMT [">link]
FTfm editor Pauline Skypala reports in today's weekly review of the fund management industry that indpendent consultants Oxera have supported (in a report out later this week) the Association of British Insurers' claims that an industry-led model for the new National Pensions Savings Scheme will not have higher costs than the centralised model (with competition by contract bids) favoured by the Turner Commission. The report was commissioned by the ABI. Apart from being fed up with spurious assumptions from independent consultants that transparently serve the vested interests of their paymasters, I shall be particularly keen to see how Oxera arrived at one assumption Pauline refers to. If marketing costs of 2% of revenues are plausible for an industry-led model , how come the ABI members currently load selling costs of more than 2% of assets onto their investment products - a difference of at least 30 times!
Stuart Fowler on 10.23.06 @ 09:42 PM GMT [">link]
The FT and AMRO Asset Management launched a competition in the summer for the dream savings product. The winning entry, in the spirit of the challenge, was a simple rounding-up scheme at the supermarket till: cash added instead of cash back.
Chris Drew and I, as creators of the 'Lambda' long term asset model, had a very different idea, much more ambitious in scope and demanding in terms of the inputs required to bring it to market. It is an idea we have proposed in the past to firms that we think have the right brand to challenge existing standardised products, using investment and delivery technologies to solve the problem of mass customisation. It remains a challenge too far - not just for the FT/AMRO judging panel. But mass customisation of dynamic goal-based portfolios will happen.
You can read here the submission Chris and I made.
Stuart Fowler on 10.23.06 @ 10:35 AM GMT [">link]
Items are colour-coded:
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Money illusion
Property myths
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Alternative investments
Making monkeys of ourselves
Personal responsibility
Streetwise finance
Kids' stuff
Public policy sense and nonsense
Regulations
Competition policy
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