multi-ties and dc pensions will be catalyst says threadneedle
Threadneedle sees depolarisation as the catalyst for the widescale take-up of multi-manager investment in the UK.
Alan Ainsworth, deputy chairman at Threadneedle Investments, said the UK needs to catch up with Europe and the FSA's plans, along with the growth of defined contribution (DC) pensions, are key to this.
As part of the FSA's strategy to depolarise the UK advisory market, banks will look to form multi-ties, Ainsworth predicted, offering a range of funds from different groups while DC schemes become more attractive with a wider choice of funds.
With the advent of the 1% product, life companies will need to keep their persistency levels high in order to compete and to do this they need to offer a choice, Ainsworth said. 'Life companies want a killer product and the way to do this is to offer multi-manager, multi-link products,' he added.
Threadneedle has been active in this market for some time, working to increase the number of life offices it offers its funds through. According to Piers Denne, director of strategic partnerships at Threadneedle, the group now has some 350 replications of its funds on offer through UK life offices. He said Threadneedle does not sell its funds on a discount via its third party relationships but has worked to become an important contact for life offices through its offering of a wide, solidly performing range and the extra services it provides to life companies.
Threadneedle runs investment seminars with intermediaries in conjunction with some of its life office partners, offers intranet services and training work with intermediaries. Denne added: 'The relationship is about helping them to grow their business. Investment is becoming more important in pensions, it is no longer just the tax breaks that pensions provide.'
This type of partnership structure is one which the group saw working well in its European business and through this Threadneedle is able to hone its act in the multi-manager market, Ainsworth said.
As part of the growth both in the European and UK funds of funds markets, Threadneedle is now considering expanding its range of fettered funds. It runs a number of managed portfolios invested in other Threadneedle funds but it may now look to expand this to offer an unfettered product.
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