What do you need to help you make the right decisions?
After having owned investments for a while, most people start to better understand the long-term nature of the process of making money and the difference between investment and speculation.
However, even people with a competent financial adviser can feel that they are only getting to scratch the surface of what goes on in markets. A few will also note that there are multiple levels of costs (see the article under the Real World tab), which may seem to be justified by results, but not always.
What sort of service do you think you should be getting?
My experience as an IFA and investment fund adviser has always been that the experience of investing is more rewarding, both psychologically and financially if it is a mutual process.
What I mean is that the adviser does the heavy lifting, applies their training and experience and makes proposals, but fully explains what they are doing, why they are doing it and what the whole range of consequences might be (good and bad). The investor then challenges that if they want to (and believe me, some do!), raises questions and seeks more explanations and only then takes a fully informed decision.
Now I know that will not always happen. Many people receive a reasonable sounding proposal that they seek to understand, but then their money disappears into some mysterious ‘managed’ pot and they pay relatively high and often rather well-hidden fees for it to be looked after, perhaps noticing that over the years not much actually ever seems to change.
In some cases, the adviser is in touch regularly, but the portfolio changes are obviously a central policy being applied to all clients without any refresh of the careful personal assessment completed at the outset. One of my ex-colleagues once called this the ‘sausage machine’ approach to client servicing. One size, or maybe two or three variants, is meant to suit all.
An obviously more attractive alternative is for the investor to have a specific portfolio designed for them based on their potentially changing objectives, tolerance of risk, capacity for loss (these are jargon phrases explained in our Glossary) and prevailing financial and economic conditions. Because all these preconditions can and frequently do change, the portfolio would need to be reviewed and changed.
Some advisers recommend that money is invested with Discretionary Fund Managers who can move investments around without consulting the investor. That deals more smoothly with the economic and financial changes but takes no account of any other changes, like a change in the investor’s personal situation, and usually adds an extra layer of cost.
So ideally, your adviser should create a bespoke investment policy exactly tailored to your personal needs, then see you often to find out if your life has changed, keep a check on the financial markets and global macroeconomics and then revise the portfolio.
Experience shows that having reviews twice a year makes a big difference to the ongoing suitability and returns of a portfolio and even quarterly reviews are at times worthwhile. That process will only work however if it is cost effective and many advisers will tell you it is very expensive to deliver such a service.
Most importantly, the adviser conducting a portfolio review must be qualified and experienced as an investment market specialist or have access to such specialist knowledge within their firm.
Can you get better value?
It is not at all fair for the investor to be charged a heavy annual fee for regular investment reviews and to then only experience an ongoing, unchanging investment experience based on a set of ‘off the shelf’, ‘middle of the road’ portfolios.
A well-resourced professional adviser may offer carefully constructed model portfolios and they may be reviewed and rebalanced often but there will still only be only a few of them and an element of the ‘one size fits all’ will be detectable, even if there are half a dozen models. In fashion terms, this is an off the peg offering, but often comes with haute couture pricing.
Some investors will find all this to be simply a confirmation of what they had worked out themselves. They may already have decided not to pay an adviser and moved over to an ‘execution only’ investment dealing platform like Interactive Investor or AJ Bell. These services have millions of customers. They perhaps get their investment research from magazines, the internet and the research services of the dealing platforms.
Such investors have plenty of information, even a range of opinions, but not really any expertise on hand.
This is where NotHarry can help you. The subscription service permits access to more advanced educational material, example portfolios that you can use to learn from and most importantly, regular totally independent intelligent commentary on investment markets. There is a blog where you can comment and there will be published replies to comments, so all subscribers can benefit from the experience of others.
There are also investment fund reviews looking at how changes impact on old favourites, interesting new funds, as well as what news you need to react to. Subscribers can ask for specific funds to be reviewed or have a technical analysis of an existing portfolio of collective funds done by NotHarry.
What is on offer?
I won’t be publishing facile best buy or ‘dog’ lists based on recent past performance. That is a process completely without merit. I prefer to dig into how a fund is built up, if possible find out what the manager is really like, not his media persona and to use my long experience to sort the wheat from the chaff.
Nor will my monthly commentary retell you the news that you will probably have already read – I will assume my subscribers are intelligent people who want interpretation and analysis, not the lazy backward looking waffle put out in so many commentaries.
And cost?
To get access to the full website content with the more detailed technical articles and see a monthly briefing. This is possibly the most valuable element as this should prompt you to talk to your adviser or question your own decision making.
You can also see the more specialist restricted readership blog posts.
You need to pay just GBP20 per month for as long as you want to access this information only service. At this service level you can also post blog comments and get replies.
Access to the fuller service which includes the option to talk to me and have fund portfolios analysed against selected performance criteria can be secured for a fixed fee of £75 per month.
This level of service will suit investors who are inclined to run their own portfolios but want an expert on hand to deal with more complex technical matters and objectively assess their decisions.
VAT is not applicable at present (because NotHarry is a small business and I will strictly limit access to the subscription service – I am not looking for a full time job!). Fees are payable by standing order and can be stopped any time without notice.
There is no formal contract, no pages of T&Cs and no fixed term although you will unavoidably find some short regulatory and legal notices coming your way and you should read these carefully.
Once you have a password, you can access the premium area of the website whenever you want and if you pay the higher fee you can contact me by phone or email to discuss investments in general terms, get my view of markets in more detail and ask for technical explanations (but not personal portfolio advice, of course).
Higher levels of service with more pro-active portfolio performance reviews or customised training and support programmes are available at very competitive prices. However, only a very small number of training plans are available at one time, so you may have to wait if you want that level of service. Where work is undertaken on an hourly rate basis (eg training) the price is GBP50 per hour (January 2021).
What you can’t have
I do reserve the right to refuse applications and will decline to deal with requests for specific personal advice that would be regulated in the UK : this service offers no advice nor personal recommendations and is only suitable for experienced investors who want to find a forthright, reliable, trustworthy source of quality research. The tone of this article should give you some idea of what you can expect.
Full service subscribers will also be able to email with questions about funds, markets and factual matters and I will reply promptly but as stated this service is not a substitute for personal financial advice.
Interested?
To get access to either the full site content or the premium service, please select the member login in tab and then ‘click to register’ and you will be supplied with a simple email-able application form that will come straight to Mark. No payment will be due until you set up a standing order – we never have access to your bank account. A free trial is available for at least one month.
Note that the editor of the site and supplier of support and training services is the individual, Mark Potter. This means that the higher level subscriber user base is limited to a number in the low tens. At times, there may be no capacity for new personal access subscribers but the option to join a waiting list may be offered. Information only subscriptions as described above are available at all times.