Investment ‘Best Buys’ lists under pressure, but research shows they are a growing source of help for millions of investors

According to new research from independent savings and investment advice website BoringMoney.co.uk, there is a growing market for ‘ready-made’ investment solutions such as robo advisers or multi-asset funds, as well as the increasing influence of the recommended fund lists for DIY investors. Based on data provided by leading investment platforms, Boring Money estimates that that 31% of total DIY platform inflows were channelled to funds on the ‘Best Buy’ recommended lists in 2018

 

12 June 2019;

The role of Best Buys lists is being challenged following the suspension of the Woodford Equity Income fund, a prominent feature of the Hargreaves Lansdown Wealth 50 list until last week.

New research from independent savings and investment advice website BoringMoney.co.uk identifies the growing market for ‘ready-made’ investment solutions such as robo advisers or multi-asset funds, as well as the increasing influence of the recommended fund lists for DIY investors.

  • As at Dec 2018 there was £33 billion invested in ‘ready-made’ solutions on DIY investment platforms.

  • Based on data provided by leading investment platforms, Boring Money estimates that that 31% of total DIY platform inflows were channeled to those funds on the ‘Best Buy’ recommended lists in 2018.

  • Gross sales of funds across the major investment platforms reveals between 9% and 40% of inflows are directed to the funds which appear on Best Buys’ lists.

As these guidance tools have become more prevalent, the DIY platform market has also grown its customer base and as at Q1 2019 there were over 5.3 million self-directed customer accounts.

Consumer confidence levels remain rock bottom

Boring Money’s exclusive consumer research, conducted for the new “50 Shades Of Advice” report (to be launched on 20th June), tests how consumers are getting help and advice with pensions and investment products and explores how the industry and the regulator can tackle the Advice Gap.

Consumers reported the lowest levels of confidence when it came to picking funds or investment products. 78% of people reported confidence levels of 6 or less out of 10 when it comes to picking investment funds. Almost a third of UK adults gave themselves a confidence score of 0 out of 10 on this.

Boring Money CEO Holly Mackay comments,

Confidence and trust have been rocked in these recommended fund lists. But the problem these lists were created to address has not gone away. Millions of customers are using these best buy lists to help inform their decisions. Simply suggesting that people use a financial adviser is not a practical solution – platforms clearly have work to do in how they select, monitor and communicate these lists more carefully as their relevance grows.

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ENDS

 

Notes to Editors:

  1. Data for ’ready-made’ solutions – source: Online Investing Report Boring Money 2019.
  2. Best Buy data - sourced directly from those platforms with fund buy lists. Data represents the largest 9 investment platforms with a combined market share of 75%. Data supplied for use in aggregate. Data used for 4 of 9 platforms is either estimated or based on previous year’s data.
  3. Consumer data: Source: 50 Shades of Advice report (to be launched 20th June 2019)

Data from a nationally representative sample of 4,179 UK adults; May 2019

 

On a scale of 0 to 10, where 0 is not at all confident, and 10 is very confident, how confident would you feel doing the following?

 6 or less out of 10

 0 – not at all confident

Choosing a product to invest in e.g. ISA, pension

64%

20%

Deciding what investments to buy e.g. what funds, shares

78%

29%

Opening a pension online

73%

28%

Opening a stocks and shares ISA/investment account online

68%

25%

 

 

For media enquires please contact:

Holly Mackay, Boring Money

holly@boringmoney.co.uk

02038712524

 

About Boring Money:

(www.boringmoney.co.uk) BoringMoney.co.uk is a free, independent financial advice website which helps normal people who don't have PhDs in finance make some smart investment decisions (without being bored to tears on the way). Founder, financial expert and commentator on investment markets Holly Mackay passionately believes that investments shouldn’t just be for “The Old Boys.” Explaining investments without the jargon, Boring Money aims to help everyone who has ever felt a bit alienated, patronised or simply cross-eyed and exhausted, to make some good decisions quickly and painlessly. Boring Money is not regulated to give personal financial advice, nor is it regulated by the industry watchdog.

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