GUIDE TO SERVICES AND CHARGES

Transcription

1 DISCRETIONARY FUND MANAGERS GUIDE TO SERVICES AND CHARGES This information is for UK financial adviser use only and should not be distributed to or relied upon by any other person.

2 DISCRETIONARY FUND MANAGERS THIS BROCHURE IS DESIGNED TO GIVE YOU AND YOUR CLIENTS A GUIDE TO THE SERVICES AND CHARGES AVAILABLE IF THEY DECIDE TO USE OUR DISCRETIONARY FUND MANAGERS SERVICE. DISCRETIONARY FUND MANAGERS Discretionary Fund Managers (DFMs) offer a professional investment service by providing expertise in the selection and monitoring of stocks and their performance. DFMs will work with you to understand your client s personal circumstances and investment needs and will make all the investment decisions, based on your client s level of risk and the rate of return they expect from their investments. Each DFM will have their own house style when creating portfolios, and some may use collective investments more than direct investment to achieve the desired asset allocation. The actual types and rates of charges and expenses incurred by a portfolio will vary from client to client, and will depend on a number of factors. These factors can include, for example: The value of the portfolio; The client s attitude to risk; Diversification of the portfolio; The geographical scope of investments; Any client-specific instructions; The specialism, views and asset preference of the investment manager; and The underlying investment vehicles and assets selected. The above list is not exhaustive. Our DFMs welcome the opportunity to discuss any queries you may have. Full terms and conditions are available from our DFMs. SCOTTISH WIDOWS DFM PANEL Scottish Widows has selected a panel of some of the UK s leading DFMs, these are: Brewin Dolphin Ltd. Brooks Macdonald Cazenove Capital Charles Stanley Investec Wealth & Quilter Cheviot Rathbone Management Tilney For Professionals A brief introduction to each of them is given on the next few pages. The DFMs on our panel are subject to change. Scottish Widows accepts no responsibility or liability for any actions or inactions of our DFMs in relation to the discretionary management of a Retirement Account. Full terms and conditions are available from our DFMs including charges, terms and limits which are all subject to change. 1

3 INTRODUCING OUR DFMs: Brewin Dolphin is one of the UK s leading providers of discretionary wealth management services, with origins dating back to the mid-18th century. Brewin Dolphin is experienced in dealing with the ups and downs of investment markets helping money work harder by sticking to tried and tested basics of extensive research backed by a consistent, disciplined investment process helping you to concentrate on building and managing your relationships with your clients. Some of the benefits of using Brewin Dolphin at a quick glance: Time Free up your time allowing you to focus on other areas of your business Resource enhance your client offering Gain access to a global investment universe, which includes many assets that may not be available to retail investors Broader range of investment types Greater purchasing power (super-clean share classes) Regulation By outsourcing your clients investment solutions to Brewin Dolphin, you reduce the liability risk to your business, of having to oversee the management of a wide range of investment portfolios for different clients Brewin Dolphin have two core services, with each having its own distinct characteristics. Brewin Dolphin s Discretionary Management service is suited to clients who require bespoke investment management, while the Managed Portfolio Service is designed to provide discretionary fund management to clients via a range of model portfolios. Both services draw on the experience and expertise of its award-winning research team. Brewin Dolphin understands that in today s fast-changing marketplace, managing clients investment portfolios has become a full-time job yet it is just one of the many demands on a financial adviser s time. With over 40bn assets under management, many financial advisers have discovered they can entrust some of the regulatory and administrative burden of their clients investment portfolios to Brewin Dolphin. The value of your client s investments can fall, and they may get back less than they invested. Source: Brewin Dolphin, March 2018 Contact Brewin Dolphin now and find out how they can help you to manage your client s needs at: Head office 12 Smithfield Street London EC1A 9BD Additionally, Brewin have 29 Regional Offices, so there is sure to be one near you. The contact details are available at: Telephone: Website: londonsalessupport@brewin.co.uk 2

4 Brooks Macdonald is a discretionary investment manager that supports professional advisers through the provision of a range of solutions designed to meet their clients objectives. As your DFM, Brooks Macdonald will collaborate with you to understand the needs of both your business and clients. In addition to its range of established investment solutions, it offers CRM integration and consultancy services which are designed to help you manage your resources efficiently, thereby allowing you to devote more time to your business and clients. Brooks Macdonald offers two core discretionary investment management services: a Bespoke Portfolio Service (BPS) and a Managed Portfolio Service (MPS). Its BPS is available for clients with a minimum of to invest and is designed for those who want an individual portfolio constructed to meet their specific requirements. Its MPS is available for clients with a minimum of 20,000 to invest and provides a choice of 11 risk-rated model portfolios, each investing in an array of different assets. Each model is designed to achieve specific investment objectives within its agreed risk profile. The price of investments and the income from them can go down as well as up and neither is guaranteed. Investors may not get back the capital they invested. Source: Brooks Macdonald, March 2018 Established in 1991, Brooks Macdonald has been a member of the London Stock Exchange s Alternative Market (AIM) since Based in London, it also has offices in 11 other locations across the UK and Channel Islands. The company manages 11.66bn on behalf of private investors, trusts, charities, pension funds and institutions (as of 31st March 2018). Contact: New Business Development Team Website: brooksmacdonald.com/uk-adviser info@brooksmacdonald.com Telephone: Brooks Macdonald manages money on a disciplined and structured basis through its proven centralised investment process, which ensures all client portfolios are able to benefit from the wide expertise of its broad investment and research teams. The consistency of its investment approach is complemented by a commitment to maintain the highest levels of client service, the success of which can be measured through its strong organic funds under management growth in recent years. 3

5 Cazenove Capital is the wealth management arm of Schroders in the UK, Channel Islands and Asia, providing investment management services to private clients, intermediaries and charities. The company s strength is founded on the lasting relationships built with advisers and their clients, combined with access to the global expertise of the Schroder Group. The DFM team has worked closely with financial advisers for 15 years meeting their individual requirements and supporting them in providing discretionary fund management to their clients. The value of investments and the income received from them can fall as well as rise. Investors may not get back the amount invested. Source: Cazenove Capital, May 2018 Address: Cazenove Capital 12 Moorgate, London EC2R 6DA Telephone: simon.cooper@cazenovecapital.com Website: You and your client will have direct access to highly experienced portfolio managers who follow a wellestablished central investment approach, and who have real expertise in some of the more complex areas of investments. There is also a dedicated support team. With offices in London, Oxford, Chester, Edinburgh, Guernsey and Jersey, the team develop and implement the most suitable investment strategy in line with your clients risk profile and financial requirements. Why choose Cazenove Capital? Cazenove Capital is a leading provider of discretionary fund management. We work in partnership with external advisers to develop and implement tailored portfolios for your clients. Our business is built on trust, something we have developed whilst working in partnership with advisers for over a decade. As part of our service, we: Develop an appropriate asset allocation strategy which meets your clients specific objectives and risk profiles Construct portfolios using a wide range of asset classes including alternatives Work with you to ensure that your clients strategies evolve in anticipation of their changing circumstances Provide you with comprehensive reporting services including the ability to access your client s valuations online on a daily basis 4

6 Charles Stanley is one of the UK s leading independently owned, wealth management groups, advising on substantial client funds. The service and support they provide is based on their Managers extensive depth of experience, combined with sophisticated technology and exceptional research facilities. Their focus on clients has endured since the foundation of Charles Stanley in 1792, a heritage that has helped to make them one of the UK s leading Wealth Management firms. Building their business on experience and quality service, they now have over 20 offices across the UK and an in-house research team based in London. Charles Stanley is a signatory of the United Nation s Principles for Responsible (PRI). As institutional investors, they have a duty to act in the best long-term interests of their beneficiaries. In this fiduciary role, they believe that environmental, social, and corporate governance (ESG) issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions and asset classes over a period of time). They also recognise that applying these Principles may better align investors with broader objectives of society. Charles Stanley & Co. Limited ( Charles Stanley ) is a wholly owned subsidiary of Charles Stanley Group PLC ( the Group ), a public company whose shares are listed on the London Stock Exchange (CAY.L). A large percentage of shares in the Group are owned by the Directors and employees, giving a strong base of stakeholders, all working to deliver success through a wide range of bespoke high quality services. In an ever-changing world, investors need an investment portfolio that is constantly monitored and managed in order to meet their objectives. At Charles Stanley they are committed to managing your clients investments actively within a structured and disciplined framework. They aim to maximise returns from a portfolio that has been designed to take account of each client s specific objectives and attitude to risk. Many DFMs only offer model portfolios of collective investments, whereas through Charles Stanley your clients will have access to a wide range of asset classes including direct equities, bonds and gilts. They believe what differentiates them from their peers is: They are independently-owned and unlike many of their competitors, not part of a bank. There is a level of staff continuity that translates into the delivery of personal service by staff with a good understanding of clients needs. Managers are free of any obligations or pressures to invest clients assets into in-house funds or products. Source: Charles Stanley, April 2018 Contact: Charles Stanley & Co Limited Telephone: steve.hill@charles-stanley.co.uk Website: professional-advisor-services Having retained the long-term advantages of being independently owned, their interests lie with you, not others. Working with charities, institutions, financial advisers and individual clients, they have created financial security for many tens of thousands of people, with over 23 billion funds under management and administration. They place great importance on making sure the client enjoys peace of mind and protection. The Charles Stanley commitment better support for you, better investment solutions for your clients. 5

7 Investec Wealth & (IW&I) is one of the UK s leading investment management companies, with responsibility for over 34 billion of client assets (as at March 2018). The heart of our business is investment management for individuals, charities, trusts and clients of financial advisers. We look after clients savings, pensions and other financial assets by using our expertise and knowledge to invest their money wisely to build and preserve their wealth. We have worked closely with financial advisers for over 25 years and gained a unique understanding of the specific needs of financial advisers and their clients. Our bespoke discretionary portfolio management service has been specifically designed to work in conjunction with you for the management of client portfolios, ISAs, offshore wrappers, pension funds and trust assets. We can incorporate client s existing investments and consider both traditional and alternative investment strategies and asset allocations to meet specific requirements. The moment you ask us to manage your client s investments we assign a dedicated Manager to work with you and your client. We aim to build a partnership and to help make your life easier. Investors should remember that the value of investments, and the income from them, can go down as well as up and that past performance is no guarantee of future returns. You may not recover what you invest. Source: Investec Wealth &, March 2018 To discover more about our Management services and how we might be able to help you, please contact Mark Stevens, Head of Intermediary Services. Address: 30 Gresham Street London EC2V 7QN Telephone: mark.stevens@investecwin.co.uk Website: Our job is to offer you a service of the highest possible standard delivered by high calibre people with expertise and integrity. Composed of experienced, unbiased, professionals, we are well equipped to give you the support you need. We constantly bring together the best ideas of all the firm s resources in pursuit of our aim to deliver consistently good risk-adjusted returns for client portfolios. We offer you the convenience of 15 offices throughout the UK and the dynamism and strength of the Investec Group to draw upon worldwide. We are always quick to respond to market changes and challenges and have the ability to invest globally, think nationally and act locally on behalf of your clients. 6

8 Quilter Cheviot has a heritage that can be traced back to 1771 and is one of the UK s largest discretionary investment management firms, with 23.6* billion funds under management and 12 regional offices. They work with private clients, trustees, charities, pension funds and their professional advisers to provide personalised and professional investment management services for investors who wish to have their portfolios managed on a bespoke basis, with their investment decisions within the portfolio. The business is aligned to cater for the unique needs of each of their clients and they concentrate on providing innovative and well researched investment ideas, using a full open market investment selection from all asset classes including alternatives such as hedge funds, infrastructure, commodities, convertibles, private equity and more. Their investment management teams are made up of experienced, highly qualified investment professionals working together towards a collective house view with a rigorous investment approach focussing on client requirements. They work closely with financial intermediaries to provide appropriate investment solutions with a focus on excellent service and reporting standards. Source: Quilter Cheviot, February 2018 Address: Quilter Cheviot One Kingsway London WC2B 6AN Telephone: Website: *As at 31st December 2017 Rathbone Brothers Plc is an independently-owned FTSE-250 listed company. Rathbones traces its history back to 1742 and has increasingly focused on financial services over the past century. Through its subsidiaries, it is a leading provider of high quality investment and wealth services for private clients, charities and trustees. This includes discretionary investment management, tax planning, trust and company management, banking services and unit trusts/oeics. We employ over 1,200 people across 15 offices in the UK and Jersey. We enjoy the stability afforded by being a FTSE-250 listed company with significant critical mass and funds under management of over 39.1bn, as at 31st December Our principal subsidiary, Rathbone Management Ltd, provides bespoke discretionary investment management services to private clients, professional intermediaries, charities and trustees. Rathbone Management Ltd is now one of the UK s largest and most successful providers of investment and wealth management services to private investors and charities. The individual portfolio service offers a detailed and personal level of attention as well as access to our extensive investment resources for clients with larger sums to invest. This service is ideal for individuals and families with more complex financial arrangements who require a tailored approach and may wish to have some influence on their investment. Source: Rathbone Management Ltd, March Contact: Intermediary services desk Telephone: Website: 7

9 At Tilney, your client s personal wealth is our personal responsibility. We are a leading private client investment company that was founded more than 180 years ago and is trusted to look after more than 24 billion* of assets. All of our services are underpinned by a disciplined, rigorous investment process and delivered by some of the UK s most experienced and highly qualified investment professionals. We have the capability to work with advisers in a flexible way that meets their business needs and offer a broad range of clearly defined investment solutions for clients whatever their stage of life or level of assets. For those seeking absolute consistency and direct access to our very best thinking, we offer model solutions in either a unitised or managed portfolio service. Where a client s circumstances require elements of a portfolio to be tailored, our personalised investment management service can accommodate specific needs. Our national reach means we can provide a truly personal service to financial advisers across the UK. We understand the challenges you face and by working in partnership, we can help you provide your clients with a truly enhanced investment management service. *As at 31st December 2017 Source: Tilney for Professionals is a trading name of Tilney Management which is part of the Tilney Group. Address: Website: 6 Chesterfield Gardens, Mayfair, W1J 5BQ Telephone:

10 MINIMUM INVESTMENTS Each fund manager has set a minimum investment amount which they will be willing to manage on your client s behalf. These minimum amounts are: Fund Manager Minimum Brewin Dolphin Ltd. 150,000 Brooks Macdonald Cazenove Capital 200,000 Charles Stanley Investec Wealth & 150,000 These charges can vary depending on the level of service required and will be agreed with the DFM selected at outset: Fund Manager Annual Management Charge (exc VAT) Brewin Dolphin Ltd. First 1m 1.0% Next 1m 0.8% Next 3m 0.5% Balance 0.2% Minimum charge of 1,000pa (exc VAT) Quilter Cheviot 200,000 Rathbone Management 100,000 Brooks Macdonald 0.75% per year on the whole portfolio Tilney for Professionals 200,000 These minimum values may be altered subject to prior agreement with Scottish Widows and the fund managers. CHARGES Any charges that apply will normally be deducted from the money managed on your client s behalf by the DFM. The table below shows what the typical annual charges would be. These are a percentage of the funds the DFM is managing for your client. Cazenove Capital 0.8% on the first 1m, 0.6% over 1m Charles Stanley First 500, % Next 500, % Next 1m 0.45% Balance 0.25% Minimum 850 Investec Wealth & 1% on first 1m, 0.75% on the next 1.5m and 0.6% thereafter Minimum Fee: 1,200 Quilter Cheviot Rathbone Management Tilney for Professionals 0.8% on the whole portfolio % on the first 1m, 0.5% over 1m 0.75% up to 1.25m 0.55% on 1.25m 2m 0.5% on 2m and above A full list of charges is available from each DFM. 9

11 SAMPLE MANDATE CHARGES AND ILLUSTRATIONS Once the charges and expenses are totalled, a Total Expected Charge (TEC) is obtained. Based on a client portfolio, we ve detailed below how the TEC could look when applied to the different DFMs. This information is provided for illustrative purposes only. Actual charges may be higher or lower than those shown and may vary depending on the type(s) and amount(s) of investment(s) made: Brewin Dolphin Ltd. Annual Management Charge (exc VAT) 1.00% VAT on AMC 0.20% Additional expenses 0.81% Total Expected Charge (TEC) 2.01%* *Please speak to Brewin Dolphin for details of the rate applicable to you Brooks Macdonald Annual Management Charge (exc VAT) 0.75% VAT on AMC 0.15% Investec Wealth & Annual Management Charge (exc VAT) 1.00% VAT on AMC 0.20% Additional expenses 1.06% Total Expected Charge (TEC) 2.26% Quilter Cheviot Annual Management Charge (exc VAT) 0.78% VAT on AMC 0.15% Additional expenses 0.43% Total Expected Charge (TEC) 1.36% Rathbone Management Annual Management Charge (exc VAT) 0.84% VAT on AMC 0.17% Additional expenses 0.60% Total Expected Charge (TEC) 1.61% Additional expenses (costs of dealing and underlying holding costs) 1.07% Tilney for Professionals Total Expected Charge (TEC) 1.97% Cazenove Capital Annual Management Charge (exc VAT) 0.80% VAT on AMC 0.16% Additional expenses 0.82% Total Expected Charge (TEC) 1.78% Charles Stanley Annual Management Charge (exc VAT) 0.75% VAT on AMC 0.15% Additional expenses 0.60% Annual Management Charge (exc VAT) 0.75% VAT on AMC 0.15% Additional expenses 0.75% Total Expected Charge (TEC) 1.65% Assumptions made in the example: We use the above sample TEC in personalised illustrations(s) which accompany the Key Features document. This is to help illustrate the possible effects that charges and expenses could have on the value of a policy. Please note that the above sample TEC does not include any Service Charge, Adviser Payment Charge(s) or any other charges that may apply to a client s Retirement Account. For a full list of the charges that may apply, please speak to the DFM. The TEC is reviewed annually. Total Expected Charge (TEC) 1.50% 10

12 DFM CHARGES AND THE RETIREMENT ACCOUNT We aim to ensure that your clients fully understand the costs associated with investing via a Discretionary Fund Manager (DFM). Therefore, for projections, we have calculated a Total Expected Charge based on a number of assumptions relating to underlying investments, investment approach and trading activity. We review these assumptions at regular intervals to ensure they remain relevant. The assumed charge can sometimes seem expensive in comparison with other providers stated charges, although it is important to understand what is being compared. For instance, many of our competitors disclose only the management charges, and not other related charges and expenses. These include, for example, custodian charges, the charges applying to underlying investments such as unit trusts and OEICs and stamp duty payable on UK equities. Product charges will also apply. Only by comparing like with like can a fair comparison of costs be achieved. VALUATIONS AND DEDUCTIONS The DFM will value the assets and sums managed by them. The method of valuation may differ for different asset types. Securities will generally be valued at the mid-market price applying on the valuation date. Units or shares in collective investment schemes will be valued at the redemption price applying at the date of valuation. APPOINTING A DFM Once you and your client have decided on the DFM they would like to use, you can arrange a meeting with your client and the DFM. KEEPING YOU INFORMED Once the DFM is in place, they will be responsible for sending your client regular statements about the value of the investments with them and any other relevant information as appropriate. Scottish Widows will be kept informed of the value of the portfolio by the DFM and will include this information in any plan valuations we provide. FURTHER INFORMATION Full terms and conditions are available from each DFM. Charges, terms and limits may change. Scottish Widows accept no responsibility or liability for any actions or inactions made by any DFM in relation to the discretionary management of a Retirement Account. The charges and expenses will be deducted from the value of the assets and sums managed by the DFM. Values provided to Scottish Widows for valuation purposes will be provided net of these charges and expenses. CHOOSING A DFM You and your client may wish to speak with one or more of our DFM panel companies to discuss their requirements before making a decision on the DFM they would like to manage their investments. Scottish Widows cannot provide any recommendation or advice as to whether these services are likely to be suitable for your client. It is up to your client to make their own selection of any DFM service they require with you. 11

13 Scottish Widows Limited. Registered in England and Wales No Registered office in the United Kingdom at 25 Gresham Street, London EC2V 7HN. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Financial Services Register number /18