There are many fine things about being Scottish. Our sense of fun; our ability to withstand hours in hot sunshine, and our famous athleticism are but three. Maybe the best thing, though, is that we get school summer holidays nearly a month earlier than the English, which means two things. Firstly, our holidays are cheaper, and secondly I’m disappearing at the end of this week for a while to check that French wine is still nice.

But fear not, the Update is immutable in the same way that regulation isn’t, and we have an exciting schedule of guest Updaters to keep things rolling through July while I’m not here. Having had 24 of them this year from me so far, I’m sure you’re ready for a change. Please be gentle with m’colleagues.

So this Update needs to be a stormer, and I’ve got just the thing.


I mentioned last week about Invesco and Intelliflo’s new IMPS proposition – a series of models supplied at a flat fee of £1 per month per client (capped at £70pm), which is available through FundsNetwork.

The more I’ve been thinking about this the more disruptive I think it could be. To be clear: I don’t know if the portfolios will be any good or not, and neither do you. There are, however, a few things I reckon we’ll be talking about for a long time to come.

First up, price. Clearly it’s a token amount; I suspect this will end up being free (obviously the OCFs aren’t free). The key feature, though, is that it’s a flat amount. I’ve long thought that the typical 0.3% plus VAT for discretionary models is a bit of a skoosh. There is work involved in running models, to be sure, but an infinitely scalable 0.3% of client portfolios doesn’t recognise any economies of scale or really anything except a cracking revenue line for the DFM.

Now, the IMPS thing isn’t discretionary; these are advisory models. But even so, having this kind of pricing in the space is going to bring the pain. We’re about to research adviser attitudes to an evidence-based fixed fee DFM MPS on behalf of someone else, and their working assumption, while more than £1pm, still doesn’t look anything like what a typical £200k client would pay for a typical MPS in a year. This is a sector which is about to experience some disruption. As with any of these things – if you’re delivering then price won’t be important. But if you’re not…


But even price isn’t the main thing. The main thing is about how this proposition stitches together. You take the portfolios from Invesco via Intelliflo. You tell clients that they need to authorise a rebalance or a trade from their client portal. They visit the portal, tick the box, and the instruction goes straight through to FundsNetwork (as I understand it anyway). This, in a stroke, changes the dynamic and the centre of gravity for portfolio management away from the platform and over to the back office. The platform, in this model, is a custody, dealing and admin service in the background; its ability to add value over and above being quick and accurate is more debatable than at any time I can remember.

I wouldn’t be surprised if this move is regarded with a bit of a raised eyebrow by some platforms. But I think it will be greeted with unalloyed joy by others – particularly platforms which don’t major on very full suites of functionality and act more as ‘custody-plus’ type arrangements. I’m thinking of firms like Seccl, Multrees and Hubwise: the new kids on the block.


It’s very early days – IMPS isn’t even live yet – and its limited nature in terms of venues may mean take-up isn’t immediate. But in terms of new industry developments that can really shake things up, it’s one of the most interesting I’ve seen in a fair while.


  • I don’t know if you caught Moneybox on Radio 4 about DB pension transfers. On balance, I’m not sure it went that well. Have a listen here on BBC Sounds. It starts at around the 15 minute mark or so.
  • Nice piece from Tom Ellis here on best buy lists.
  • And something really interesting from the Financial Services Consumer Panel, asking for ‘upgrades’ to be mandatory. Cue nervous shuffling from big insurers sitting on old pension books, I think…
  • And your music this week is both French and absolutely joyous. Please be upstanding for Gojira and the insanely wonderful Silvera. You haven’t had enough heavy stuff in the Update, and I doubt you’ll get much in the next 4 weeks. So this will have to keep you going.

And that’s it. Fin.

See you in a bit; be good