Selestia is urging IFAs to dump the traditional approach in advising clients and to adopt a more rig...
Selestia is urging IFAs to dump the traditional approach in advising clients and to adopt a more rigorous attitude to portfolio construction.
Selestia claims that the selection of single specialist funds can lead to unnecessarily high risks for investors.
The company has published an investment guide for IFAs called 'Guide to Making Investments Manageable'.
Bill Vasilieff, marketing director of Selestia explains, "As was only too painfully demonstrated during the recent technology boom, funds within a single sector tend to move together. The result of taking the traditional approach is that, when it goes wrong, investors are put off investing altogether, which is exactly what we are seeing."
The guide points out that the Myners report spurred IFAs to spend more time on asset allocation.
Moreover, Selestia believes IFAs have a keen interest in asset allocation but the tools for asset allocation have only ever been at the disposal of institutional investors. Hence, the company is offering IFAs access to a range of asset allocation tools.
IFAs can choose among three tools in the portfolio construction process, the risk profiler, which uses a questionnaire to refine the client's investment objective, the asset allocator, a device that will identify optimal asset allocation between different sectors, and the fund selector allowing the IFA to compare and sort funds.
The tools can be accessed from the Selestia website and IFAs will need to register in order to gain access to the IFA extranet.
For more information call 08456 410 410 and click the link on the right to register on Selestia.
Leading losses in the NASDAQ
Fight ‘familiarity bias’
Our weekly heads-up for advisers