Advisers are now able to build, run and trade share portfolios as actively as a fund manager - but with trades costing as little as 50p, a fraction of the usual cost, a firm has said.
Discount broker Clubfinance said IFAs using its Frequent Trader service to buy 50 shares and make 60 share deals in a year - the Lipper average for an actively-managed UK fund - could save hundreds over a mutual fund.
Director said David Scrivens said while the opportunity was a "tricky one" for advisers to get right, it had seen IFAs using the service that launched in July in a number of different ways.
"Some are white-labeling and offering it to clients as a direct service, others are using it as Clubfinance service and charging a fee," he said.
The most popular had been to offer existing clients an easy way to access an execution-only share dealing service.
"When you invest in a fund you are paying for the skill and expertise of the fund manager and funds remain one of the best ways to access overseas markets," Scrivens said.
"However, for confident investors, capable of managing some of their portfolio themselves, it is becoming much more cost-effective to regularly trade UK-listed shares.
"Trading a portfolio of shares can dramatically cut costs compared to investing through a mutual fund, which is something many investors and intermediaries probably do not realise.
"Of course, it' not for everyone and we would advise all investors to still seek appropriate investment or financial advice before trying to run their own portfolio."
Advisers have been weary of offering execution-only services to clients at the risk of being cut out of the process. But Scrivens said an advised equities service presented more of a business risk.
"For larger IFAs who white label it's not that much of an issue, but for smaller IFAs they have to make sure they properly advise their clients," he said.
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