FundsNetwork beats rivals to list UK investment trusts
Fidelity FundsNetwork has become the first of the fund supermarkets in the UK market to confirm it will offer investment trusts ahead of the Retail Distribution Review (RDR) implementation.
Beating rivals Cofunds and Skandia to the punch, Fidelity said plans are under way to list investment trusts on its FundsNetwork platform this year.
Fidelity will begin making closed-ended vehicles available from November, Investment Week understands.
The group is expected to offer the most popular and liquid trusts initially, with a view to expanding the number available at a later date.
At the end of last year, Fidelity began offering its own range of investment trusts through FundsNetwork, bringing in the necessary technical changes to make shares tradable on its platform.
Fidelity said larger trusts will initially take precedence on the platform for cost reasons.
“Investment companies will be listed on FundsNetwork in the latter stages of the year, and it will be the most popular trusts attracting the greatest investor appetite which will be listed,” the group said.
“The size of the investment trust is an issue, and with the more illiquid trusts there is a cost metric involved.”
Fidelity’s move will allow it to meet RDR rules stating if an adviser uses a single platform, products must be offered in an unbiased fashion.
The other two large platform providers in the space, Cofunds and Skandia, have not yet unveiled proposals to list investment companies.
Investment Week understands Skandia will not be making closed-ended funds available this year. Instead, the firm is focusing its efforts on ensuring its platform is RDR-ready for open-ended vehicles.
A spokesperson for Skandia said the group sees limited demand for vehicles such as investment trusts and ETFs compared to unit trusts and open ended investment companies (OEICs). Meanwhile, Cofunds is piloting a stock trading service with Barclays Stockbrokers which will allow advisers to access multiple asset classes such as stocks, bonds, ETFs, and investment trusts, but has not yet committed to rolling it out to the wider market.
This article was first published on Investment Week