Every so often something comes along in the public discourse that we can all really get behind. Such a one was Brandon Lewis’s magnificent admission yesterday, which opens the door for all kinds of merriment.

Driving when unsure you’re safe to do so in the North East of England? “I was breaking the Highway Code in a specific and limited way.”

Caught making friends with Mary Jane by your local Dibble? “I was contravening the Misuse of Drugs Act 1971 in a specific and limited way.”

Failing to demonstrate suitability to the required standard? “I was contravening MiFID II in a specific and limited way.”

Caught trying to convert a UCITS to a NURS owing to prohibited holdings in real estate and gold? “I was breaking Article 1(5) of the UCITS Directive in a specific and limited way.”

I could go on.

It’s a self-imposed rule that the whimsy at the top of the Update needs to link to the content somehow, somewhere deep in my tortured unconscious. But happily, I can now break this rule in a specific and limited way, so let’s just have at our subject and let no snook be uncocked at the rules.

I got some data through on Monday, which is nice for me. The data came from our platform suitability tool, Platform Analyser (don’t worry, this isn’t a plug, keenly priced, buy now, etc) and is the first big slug of usage data we’ve looked at since launch. Amongst all the interesting stuff about how often people dive into the detail on particular platforms, we also look at what the most common must-haves are for firms when they run full due diligence checks.

There was a bunch of stuff in there that you’d expect – wrapper availability and so on – but the first real feature that folk are selecting to rule platforms in or out is whether the platform has full open architecture for OEICs (Analyser is silent on adherence to Article 1(5) of the UCITS Directive), and the second is a CGT tool.

Isn’t that interesting? I think it’s interesting. You might not think it’s interesting, but I do. Here’s why.

First up, we know the classic debate around open architecture. No one client needs it, and most CIPs mean that firms use a relatively limited range. If we look across the market at top selling funds, there tends to be a lot of commonality, and while there’s a long tail of other stuff, it’s quite common for there to be hundreds if not thousands of funds available on a platform with no flow and little or no AUA. Conversely, though, you never know what a client will turn up with, and if you want to re-register a fund from elsewhere it needs to be available on your platform of choice. And if you’re doing a proper job of asset selection, especially for actively managed CIPs, you never know what you’ll need next quarter.

So round and round we go. The thing is, if we look back to the few quarters immediately before the Current Unpleasantness, platforms with limited architecture (mainly ones which come with a CIP all bundled up) were getting a lot of love in terms of both service ratings and gross inflows. From that and lots of chats with firms, we saw a definite emerging theme around a lessening of the importance of being able to hold anything in favour of gaining efficiencies by keeping the decision set more focused – though still way wider than old life company world. So our exam question is: has something changed in the last six months?

While we’re at it, that CGT question is interesting too. Most clients don’t have CGT issues – 276,000 people paid CGT in 2018/19, which is slightly under 1% of income tax payers. Sector-wide, only about a third of assets are potentially exposed to CGT by being held in a GIA. A good whack of that is actually pension asset, so the real number will be considerably lower, and of course not every GIA holding is big enough to trigger CGT worries, nor does every client have gains elsewhere to worry about.

More questions than answers – but in both these cases I think there’s an interesting ‘just in case’ type thought process going on. It’s good to anticipate future needs, but if we stuck to what the client needs now, and accepted that transfers may be necessary in future if things really change, would we get different answers? I kind of think we might.


  • HomeGames this week will be fun – we’ve got Phil Young, late of threesixty, Sense Network (nearly) and currently of Zero Support and Bury AFC on. Phil will be our most #northerly guest, and this session will be 37% more dour than normal as a result, but still well worth tuning into. You may do so here at 12.30pm, or catch up later here.
  • A further shill for our suitability and due diligence whitepaper – totally free, no need to leave any details to read, no salescat will call, etc. Read Let The Suitable One(s) In here. (opens flipbook).
  • Interesting new developments from the folk at AJ Bell – a fund research tool called Fundamentals. I for one am sad so few sub-editors have had fun with Fundamental puns, but life is disappoint sometimes.
  • Good piece from the FT here on robos being slow to gain ground in the US; obvious lessons to learn over here.
  • And your music choice this week? No choice at all. Please enjoy Breaking The Law by Judas Priest, but only in a specific and limited way.

See you next week, when it will be the lang cat’s 10th birthday.