Is the DFM cost war in danger of leaving suitability behind?

'Vanilla products with little differentiation'

As cost competition intensifies in the discretionary fund manager (DFM) market, Jon Yarker explores whether there is a risk of client service being negatively impacted as a result.

Over the past few years DFMs have capitalised on a growing demand for outsourcing investment functions from advisers. The advantages for those using this route are clear: for a fee they can offload the burden of investment, and the significant time and resources this requires, to a third party. The adviser can then focus on their core responsibilities, namely providing financial planning and advice to their client bank. Unsurprisingly, the DFM space has grown significantly as a result and competition has intensified between these players. To thrive in this flourishing market, DF...