Advisers believe proposals to re-label the Investment Management Association's fund sectors will not help consumers better understand the levels of risk the funds carry, research suggests.
In a Skandia survey polling 876 advisers, 84% said they did not think changing the names of the sectors from Aggressive, Balanced and Cautious to A, B and C would aid consumer understanding of risk levels. More than 90% of respondents said they believed funds labelled "cautious" could be misleading to consumers. Whereas advisers believe the majority of their customers would fit the risk profile of a cautious fund at around two or three out of ten, the actual level of risk for most funds in the IMA's cautious managed sector is closer to five or six, said Skandia. This, it said, repr...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
