Posts tagged as commissions

12 Jan 2006

The Cost Wedge: an American perspective

My professional body’s journal (Financial Analysts Journal) this month includes an article by John Bogle of the Vanguard mutual fund group in America. Bogle is unmatched in the UK. We have no top executive within financial services who has demonstrated over an entire career a dedication to the interests of the customer as the very basis of professional stewardship of money. A deeply old-fashioned philosophy, it has been repaid handsomely in Vanguard’s steady growth in market share for the past 30 years.

read more Commentary by Stuart Fowler
26 May 2005

D(epolarisation) Day: what might have been

From 1st June all financial advisers must spell out whether they are independent agents or tied to one or more product manufacturers and what and how they get paid. It’s the last step in the FSA’s ‘depolarisation’ programme and a much watered down version of its original plan to make the adviser/salesman distinction clearer and prevent commission bias. How watered down is demonstrated by the belief in the industry it need make no effective difference to how you run your business.

read more Commentary by Stuart Fowler
06 May 2005

The cost wedge just got fatter

Most personal finance sections have recently converged on the story that several large fund management houses are pushing up annual management charges again. This is an inevitable consequence of consumers using more agents, including the internet, to avoid or cut front-end loaded sales commissions. The effect is that more of the commission payments from providers to distributors must take the form of a share of the annual management charge, making distribution costs more equal across different types of fund and the ‘cost wedge’ harder to avoid.

read more Commentary by Stuart Fowler
23 Feb 2005

Insurers say ‘no commission bias, OK?’

No, not OK. The Association of British Insurers have published a report proposing changes to the commission basis for distributing financial products in the UK. I’ll come back to their proposals in another entry but first let’s focus on what they say about commission bias.

read more Commentary by Stuart Fowler
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