Money Management articles from December 2005

Money Management archives from December 2005

Power to the people.
December 1, 2005... The Pensions Regulator will have the power to cut the pension benefits promised to employees if the company can no longer afford them, according to the recently released consultation document laying out how the regulator will police the funding...

Just another brick in the wall.
December 1, 2005... Fund managers are facing substantial tax barriers, making it almost impossible for them to market funds in certain EU countries, according to accounting giant PricewaterhouseCoopers (PwC). In a report, PwC detailed the obstacles that...

Mystery shopper uncovers scandal.
December 1, 2005... THE FSA SAID THAT IT HAD identified a number of serious malpractice cases. in the sale of payment protection insurance (PPI). The regulator added that PPI providers should take urgent action to address the problem or face disciplinary action....

Updates.
December 1, 2005... In the October supplement carrying the individual pensions survey, it was stated under the 'No shows' heading that we were disappointed that Royal London had not provided us with figures for its unit linked pension funds, despite having been...

Blast from the past.
December 1, 2005... Back in December 1980, Money Management' annual survey of a decade of unit linked plans reported on the rosy returns being provided from the top performers, with returns easily exceeding those of with-profits policies. Having established a...

Test-tube advice.
December 1, 2005... The financial advice industry has for years been keen to prove its worth in tangible terms -- and now it may have the chance. Axa has embarked on a social experiment, tracking 20 households from Brighton over a 12 month period, with half...

A mighty wind.
December 1, 2005... Keydata is targeting investors looking for environmentally friendly opportunities. The group has set up Neilebock Wind Power LLP. Subscribers are offered, but not guaranteed, 6% income pa, with tax advantages on the initial...

Take your partners.
December 1, 2005... Someone asked me recently when I was going to retire. My initial, knee-jerk reaction was shock. Me? Retire? Frankly, I hadn't given it any serious thought, and was a bit taken aback to be asked. But at least, I suppose, when I do finally...

Get smart.
December 1, 2005... Axa Investment Managers (Axa IM) has developed the Smart fund platform, which head of UK retail Simon Ellis describes as a 'mini internal supermarket'. The platform will open up funds from Axa IM UK, Axa IM France, Axa Rosenberg and Axa...

World indices at your fingertips.
December 1, 2005... Barclay's Global Investors has listed 14 new exchange traded funds (ETFs) on the London Stock Exchange under its iShares brand. The ETFs are based on a wide range of indices covering different countries, geographical areas and sectors...

Panel power.
December 1, 2005... Back in 1997 the introduction of the FSA had wide sweeping consequences for IFAs. In the following year advisory responsibilities were given to a new consumer panel under the Financial Services and Markets Act. But has the panel been effective...

Asian aims.
December 1, 2005... A new wave of funds has been launched in a bid to capitalise on much vaunted growth opportunities in the Asia Pacific region. Among them is the Henderson Asia Pacific Property Equities fund, which will invest in quoted stocks of companies...

Bonds, ethical bonds.
December 1, 2005... Standard Life Investments has launched an ethical bond fund OEIC, which has a projected annual yield of 5.5%. The fund is targeted at ethical investors who want a low-risk investment or who require income. The portfolio will consist of...

The pensions gap: hiding from reality.
December 1, 2005... Has it ever struck you as distinctly odd that, after seemingly endless consultations and Government initiatives to reform pensions and encourage savings, the savings ratio has hit an all-time low, borrowing levels are at record highs and a...

Levelling the playing field.
December 1, 2005... HEDGE FUNDS, STILL LARGELY the domain of the wealthy, enjoy extraordinary trading advantages -- light regulation, short-selling, unrestricted use of leverage and derivatives and many other advantages. Hedge industry practitioners readily...

Power struggles.
December 1, 2005... Until 1986, a power of attorney could only operate whilst the person granting it was mentally capable. The Enduring Powers of Attorney Act introduced the enduring power of attorney (EPA). This acts as a general power of attorney whilst the...

Getting in a flap.
December 1, 2005... "One dead parrot in quarantine does not mean that Britain is about to face a pandemic this winter", said Bill Burns, head of pharmaceuticals maker Roche, in an interview with the Daily Telegraph on 9 November. Roche makes one of the only two...

Closing time for business as usual.
December 1, 2005... In the US, the retail financial services market is led by a number of large financial services businesses: banks, securities firms, mutual fund companies and insurers. All compete intensely for consumer savings in a market where personal advice...

National debate.
December 1, 2005... National Savings & Investments (NS&I) bosses have come under fire from MPs for potentially misleading investors by describing products as 'tax-free' when the tax breaks are already priced in. MPs grilled NS&I chief executive Alan Cook at a...

Taking stock.
December 1, 2005... Susan Miller and Tom Coyne left Wall Street in 1997 to establish www.indexinvestor.com. This was dedicated to bringing to the private saver the best academic information of the working of the securities markets and, in particular, how the...

Will planning and the family home.
December 1, 2005... It is a given that for married couples and registered civil partners after December should ensure that the nil rate band -- the amount taxed at a zero rate that is available to each individual (AGBP275,000 for 2005/06) -- is not wasted on first...

Rising interest.
December 1, 2005... Competition among buy-to-let lenders has been hotting up as so-called mainstream lenders in search of additional business muscle in on their market. Alliance & Leicester is the latest to announce that it is launching into buy-to-let in 2006. As...

Statement of intent.
December 1, 2005... Liverpool Victoria has pledged to breathe new life into the with profits bond market with the launch of a 'new generation' product. The life office claims its 'All-in-1' investment bond addresses concerns surrounding the with profits bond...

Gentle persuasion.
December 1, 2005... On 1 December 2004 the Financial Services Authority (FSA) made new rules abolishing the polarisation restrictions that previously applied to firms providing advice to private customers on packaged products. These rules were introduced over...

Would small firms auto-enrol?
December 1, 2005... Auto-enrolment, 'soft' compulsion where employees are put into a company pension scheme unless they opt out, could be a key Pension Commission option in its impending report. But the areas where higher pension contributions are most needed are...

Shifting the focus.
December 1, 2005... The past three years have seen rapid acceleration in multi-manager investing, with retail multi-manager assets under management in Britain growing from AGBP12bn in 2001 to AGBP27.5bn in June 2004. (Cerulli Global Multi-manager Products survey,...

Different accent, same issues.
December 1, 2005... In recent years the financial services industry has been accused of over promising and under delivering. It seems that this accusation goes right to the heart of an industry whose end product is intangible but has a significant impact upon the...

Down but not out.
December 1, 2005... Advocates of with profits bonds could be excused for developing the resigned attitude of the much maligned. After all, few products have endured a harder ride from the financial press in recent years than with profits bonds. In fairness,...

Building bridges.
December 1, 2005... The Financial Services industry has a history dating back to Roman times, when Roman soldiers each had significant deductions made from their salary, which were then placed in a central fund. The purpose of this fund, which could be the first...

SIPP advice clarification calls.
December 1, 2005... Pension specialists are calling for clarity over whether they will need to be authorised to give mortgage advice if they advise on residential property loans via SIPPs after A-Day. Under the current rules, pension IFAs do not need to be...

Tax driver.
December 1, 2005... Luckily for with profits bondholders, Chancellor Gordon Brown seems to have forgotten that just a year or two ago he was considering eliminating the tax-free withdrawal facility attached to all single premium life bonds. Matthew...

Polarised prospects.
December 1, 2005... The next generation of with profits bonds is beginning to emerge, but the challenge facing providers continues to grow. The difficulty they face is that, even if they can build products that meet investor needs and outperform equivalent asset...

Diversification or bust.
December 1, 2005... Goodness is the only investment that never fails, according to philosopher Henry Thoreau. But, while investors might accept some of our investments failing some of the time, they want to see their capital grow over the long term and that means...

SIPPs and sensibilities.
December 1, 2005... A series of scandals have tainted certain aspects of the financial services sector in recent years. Take, for example, the collapse of under-funded occupational pension schemes, the spotlight on endowment mortgages and the Equitable Life...

The pensions exotica puzzle.
December 1, 2005... Much has been made of the new investment opportunities that will present themselves post A-day and rightly so. There can be little doubt that it is as a result of the media coverage of the new range of possible options, notably residential...

Putting your money where your house is.
December 1, 2005... The current obsession with bricks and mortar is derived from over a decade of rising house prices. The market is perceived as being lower risk than equity investments, but the period immediately before the current upturn was marked by an...

Property practicalities.
December 1, 2005... A-Day will herald the biggest change to pensions tax rules in nearly 40 years and promises to introduce a swathe of new opportunities for pensions savers. Arguably, the most significant of these is the introduction of residential property as an...

How it should be done.
December 1, 2005... To say that the goal of multi-managers is to generate outperformance for their clients is obvious, but the fact is that there are many ways to set about achieving this. No matter how much the numbers are crunched, managing funds of funds...

Reach for the stars?
December 1, 2005... It is probably fair to say that the gravitation towards multi-manager in the UK has grown out of the bear market of 2000-03. "The bear market taught people that if you get investment management wrong and you have no diversity, then you're...

SIPPs for the masses.
December 1, 2005... The greatest post A-Day challenge for the industry must be to take SIPPs to the mass market. This is only achievable if the environment is right and the changes that are expected to make this a reality are A-Day and depolarisation, the latter...

Opportunity knocks.
December 1, 2005... If asked about the incoming Pensions Simplifications regime, the average man on the street would likely struggle to explain exactly what the changes will mean. Mention self-invested personal pensions (SIPPs) and the reaction would no doubt be a...

Liver looks for PTA answers.
December 1, 2005... Royal Liver has begun work on a pension term assurance (PTA) proposition in a bid to capitalise on a post A-Day surge of demand -- the first provider to do so. PTA is historically a low sales product with complex qualifying rules creating...

In the clear.
December 1, 2005... Legal & General is breathing a sigh of relief after the Treasury clarified its plans to retroactively tax the investment reserves of life offices as part of its anti tax avoidance drive. Last month, L&G spokesman John Morgan told Money...

Buying in bulk.
December 1, 2005... Vulture fund boss Hugh Osmond is understood to be setting his sights on the closed pension fund market, looking to snap up mature occupational schemes. Pizza Express entrepreneur Osmond, now head of closed life fund consolidator Pearl...

Wrap ready to roll.
December 1, 2005... STANDARD LIFE HAS promised to deliver the first genuinely comprehensive wrap proposition when it hits the market early next year. IFAs will be justifiably sceptical of the pledge after hearing similar promises from other wrap providers in...

CII goes dippy.
December 1, 2005... The Chartered Insurance Institute (CII) has responded to IFA demand for more tailored exams by launching a new modular qualification programme. The Diploma in Financial Planning (DFP) will be introduced next year as part of the phased...

Make or break.
December 1, 2005... Many advisers are already focusing on the increased SIPP business opportunities that will arise before and after A-Day. But it has taken a long time for SIPPs to reach this level of topicality. It is very easy to forget that SIPPs were...

Drawdown drawbacks.
December 1, 2005... Government Actuary Department (GAD) proposals for assumptions used in calculating pension income withdrawal schemes could see drawdown levels for men aged over 74 drastically reduced under the incoming pensions regime. As part of a...