Wealth managers respond to ‘overly cautious' criticism

WEALTH MANAGERS

Wealth managers have responded to a KPMG report accusing them of being "overly cautious" with clients' cash, costing them higher returns.

The KPMG report UK Wealth Management at the Tipping Point? said clients are being driven towards holding cash or high grade fixed income instead of alternative investments, leading to a lack of diversification and underperformance. “There is a real debate as to how the clients, the industry and the regulators should frame the risk appetite debate. Long-term social good is not achieved by taking too much risk but, equally, too little risk is not a good idea either. The regulatory tools need to be sharpened – this requires management to take their share of responsibility, but it also pl...