Why is Spain so different?
According to FCA data, 84% of UK based financial advisors can class themselves as ‘independent’. An Independent advisor can search the whole market for the best solution for their clients, rather than being restricted to a small selection of ‘off the shelf’ funds. Being independent is by far the most popular option in the UK, because, on the whole, it is the best for the end client, and surely that should be your advisor’s priority? So why is Spain so different? Many firms in Spain mistakenly refer to themselves as independent, but absolutely are not. I can identify in seconds exactly which firm set up a particular portfolio, because it will contain the same 3-4 funds they use with every client across their entire group. This is really problematic for me. When a Chorus advisor builds a client portfolio, we have the ability to search the whole market. We look to diversify your portfolio across different asset classes and different geographic regions. We build shortlists from thousands of available funds, compare track records, the management team, independent star ratings from companies like Morning Star and Trustnet. We work closely with prestigious companies like The Prudential, Rathbones, Schroders, Investec, and place our clients in the most optimal portfolio available. I simply couldn’t work under the conditions of a restricted advisor. They often only have access to say one Technology fund, one Global Equity fund, one Emerging Markets funds, one Asia fund etc and regardless of how that fund performs against other funds in its class, they simply lump their entire client base into it. I think you all know by now, from reading my articles for many years, why these choices are made. Yes, they have deals with certain funds houses, and yes, those fund houses pay them commission to put all their clients with them, raising the cost to you and lowering the quality of your investment. Is this legal? In the UK, no, in Spain… yes. Does a company being FCA regulated protect you from that practise? Absolutely not. In the UK it would, but offshore business is not protected by FCA regulation unless you are specifi cally choosing FCA regulated funds for your clients, and that is not something these companies are doing. They are choosing the offshore version of these funds, because regardless of how much they mention the FCA in their advertising, it simply does not apply to you if you are a Spanish resident having offshore funds recommended – I bet you didn’t know that!? I know we go over the same points week after week, month after month, year after year, but all we’re trying to do at Chorus is encourage you, the public, to question the advice you’re being given to ensure you are in the best available plan. Chorus will continue to promise you, very publicly, and open to as much scrutiny as possible, that when we build your portfolio, we will only use FCA regulated funds from the World’s leading fund houses, and not build a portfolio that contains any fund that pays us a commission. All we can hope, is that one day, other firms will join us, and make the same promise. Remember, often the practises raised in this article are deeply hidden, or you only become exposed to them after you’ve been tied into a longterm plan and it’s too late to cancel. Always get a second opinion before signing that paperwork. Call me direct on 693 107 044 or email email@example.com.