Investors perturbed by the current level of fund manager defections have been advised to invest...
Investors perturbed by the current level of fund manager defections have been advised to invest in a managed vehicle, such as a fund of funds, by Paul Talbot, Managing Director, Edinburgh Portfolio.
Talbot says this obvious and simple solution minimises the impact of a "star" manager defection because changes can be made, if necessary, without incurring potential capital gains tax liabilities. If the move is thought to be beneficial, money can be switched quickly and without incurring too much cost, reasons Talbot.
Investors have good reason to be nervous at present - Although being asked to take a long term view in most cases, high profile moves force an investor to consider making short term decisions.
Talbot commented: "The intermediary market has taken an unhealthy interest in" Star" managers for some time now. In addition, most investors will not be aware of the defections until the news becomes public. This is often some time after the "market" is aware and may already have taken action."
Defections also raise an interesting question with regard to the proposed changes to Polarisation says Talbot. He asks what can an IFA do if there are high profile defections from one or more of an advisor's chosen links.
What made financial headlines over the weekend?
To promote 'long-term investment'
Switching 'hard and expensive'
Smaller funds still packing a punch