Frost Consulting launches Mifid II cost platform

With Mifid II rules looming, Frost Consulting has launched FrostRB, a platform that enables managers to establish a monetary value for unpriced research products and construct research budgets that meet the pending regulatory requirements.

Mifid II will require asset managers to tell their clients, the asset owners, much more about expected research budgets, implying budgets must be set transparently at the strategy or fund level rather than at the company level, Frost Consulting said. This also means requirements to provide monetary values for research that is budgeted per asset class.

It estimates that asset managers spend some $20bn annually of commission on external research, but there is precious little information that can specifically tie the cost of this type of research to specific funds; Frost Consulting adds that this raises the risk of cross-subsidies – asset owner’s commission payments buying research that is unrelated to the strategy in which they are invested.

“These unnecessary costs and inefficiencies reduce returns for asset owners,” Frost Consulting stated.

Neil Scarth, principal, Frost Consulting, said: “The institutional investment research market is at the inflection point of the biggest change since the US Securities and Exchange Act of 1934. We are very excited to be launching FrostRB to help asset managers create, and demonstrate, better investment outcomes for asset owners.”


Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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