The Consumer Duty Products and Services outcome requires advisers to truly tailor their advice to the individual needs of the client. It is crucial to conduct thorough fact-finding and needs analysis to understand each client's unique circumstances, goals, and risk tolerance.
Investment recommendations must be based on solid research and a clear audit trail of research and comparisons undertaken in order to make the recommendation and demonstrate that it is suitable. Ongoing monitoring and regular reviews are also necessary to ensure that the products recommended perform as expected, and that they remain suitable for the client.
How FE Analytics helps you to meet the Consumer Duty Products and Services outcome
FE Analytics is one system for fund research, portfolio construction, analysis, risk profiling, reporting and ongoing monitoring. It provides a holistic view of your investment proposition, ensuring investment suitability and increased efficiency, and demonstrating the value of your advice to your clients. Here’s how:
1. A consistent step by step investment process
The Investment Planner tool in FE Analytics is designed to help you deliver consistent and compliant investment advice by bringing all the steps and processes together. Doing this helps you to provide good outcomes for your clients while avoiding foreseeable harm, both of which are key aims of Consumer Duty and the Products and Services outcome specifically.
2. Assess your clients’ attitude to risk
Found within the FE Analytics Investment Planner, our ATRQ, powered by EV, is a psychometric risk questionnaire designed to easily establish the level of risk each client is willing to take and supporting a robust advice process. There is also the option to customise the questionnaire by adding additional questions – allowing you to gain more insights into your client without having to use any additional software.
3. Possibility of loss reporting
Whilst psychometric questionnaires are an invaluable tool, also having in-depth conversations with your clients is crucial to accurately determining their risk profile. The Investment Planner’s Possibility of Losses reports describe the suggested risk profile, reviews the performance of the chosen asset allocation and the likelihood of losses based on historic data to help guide these conversations. Then, if you feel the risk score given by the questionnaire is not quite right, you can manually update it within the software along with your reasoning for a full audit trail.
4. Ensure suitability of your investment recommendations
Investment Planner can help you map any investment solution to the most suitable risk profile. Importantly, it can be customised to match your firm’s investment proposition, so you can add your preferred investment options against each risk profile, such as multi-asset funds, in-house model portfolios, and our outsourced portfolios such as those from FE Investments.
Investment Planner provides the suitable range of FE Risk Scores that would suit your client’s profile, and suggests investment solutions that are within range. Our FE fundinfo Risk Score presents an easy-to-understand measure of volatility relative to the UK large cap index of the 100 largest companies – demonstrating the consistency of a portfolio’s risk profile in both the immediate and long-term, when compared to the market.
5. Unparalleled investment data
FE Analytics gives you access to over 300,000 funds and instruments to browse and compare, so you can easily shortlist funds based on your suitability criteria and run detailed analysis to support your investment recommendations.
Access key European ESG Template (EET) data and ESG ratings from ISS to research and recommend investments which match your clients' investment objectives and values.
Our built-in MPS Directory provides access to over 75 of the UK’s most-used DFMs, enabling you to conduct extensive research and due diligence across a wide range of model portfolios, all in one place. We receive data directly from the providers so you always have access to full, accurate, and up-to-date performance history and information for each model portfolio listed.
6. Fund factsheets and documentation
Once you have chosen a portfolio or have built your own custom portfolios, our fund factsheets provide a thorough insight into the fund objectives, manager, performance, and other key details to ensure suitability with the client’s goals and objectives. These factsheets can be exported and saved, supporting a fully evidenced research process. You can also access original fund documentation, including fund factsheets, key facts, annual reports, prospectuses and KIIDs.
7. Create compelling reports with a fully compliant audit trail
Choose from a range of pre-built templates or build your own custom reports. Select from 150 data fields to tailor a report to your exact requirements.
Within the Investment Planner tool, we provide a number of reports to support you – such as a detailed portfolio report detailing the risk, volatility and performance of your chosen investments, as well as a portfolio breakdown. If you are deciding between two portfolios, you can access a side-by-side portfolio report to support a direct comparison to ensure you can choose the most suitable investment option.
Our portfolio switching reports clearly outline the differences between existing and proposed portfolios, from risk, to diversification, and performance. These reports are pre-built and available at the click of a button – effortlessly enabling you to undertake an in-depth and clearly evidenced research process.
8. Ongoing monitoring
The FE Analytics Alert Manager is a great way to keep an eye on your whole investment proposition – allowing you to receive alerts based on specific metrics, such as performance, that will notify you if your defined thresholds are exceeded. This functionality helps you ensure that chosen investments remain suitable and continue to provide the best outcomes for your clients.
Recommend the most suitable investments for your clients with FE Analytics
Through its wide coverage of funds, ratings, tools, reports and calculators, FE Analytics can help you and your clients to make better informed investment decisions, supercharging your financial advice and ensuring initial and ongoing suitability.