Vanguard launches ETF microsite ahead of UK RDR deadline

Vanguard Asset Management has launched a new ETF microsite for financial advisers ahead of the deadline for implementing the Retail Distribution Review – which seeks to change the way financial products are sold to the UK retail investor market.

Vanguard said the new microsite would assist advisers in the UK to boost their knowledge of the ETF market. It suggests that many advisers will increase client exposure to lower-cost passive products, including ETFs, as a result of RDR.

Starting from 31 December, UK regulator the FSA will require all investment advisers to undertake a minimum of 21 hours of certified continuous professional development, or CPD, instruction annually.

The CPD modules in the ETF microsite start with basic information about how ETFs work, and move on to information about different types of index replication methods, securities lending, ETF methodologies and possible risks. Each module completed offers a CPD certificate.

Nick Blake, head of retail at Vanguard Asset Management, said: “The RDR has left many advisers grappling with the challenge of how best to offer value to their clients. ETFs are a hugely useful tool for constructing broadly diversified long-term portfolios, and the number of ETFs available to UK investors is growing rapidly. However, we find that many advisers want further support in their understanding of ETFs and how best to use them in a portfolio. From a client’s perspective, ETFs are just another way to invest in a stock or bond market index fund, but the underlying mechanics are a little different, and it is important that advisers understand every aspect of this to ensure that they are fully prepared to include ETFs as part of their ‘whole of market’ guidance.”

“RDR implementation will bring many of the costs and charges associated with investing into the open. This increased transparency about fees will enable investors, assisted by their advisers, to make more informed choices. Vanguard offers a unique combination of low-cost, tight-tracking ETFs from a provider that investors know and trust, and our experience and indexing expertise means we’re ideally qualified to offer advice and guidance in this area. We hope our new microsite will help advisers feel more comfortable both in determining the suitability of ETFs for their clients and in helping them choose the right ones for their needs.”

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