With the planned RDR changes just around the corner, investments trusts could see a 225% uplift in recommendations from IFAs once the new legislation is introduced, according to a recent survey from J.P. Morgan Asset Management.
The study, found that over a third of IFAs (36%) are likely to recommend investment trusts next year, an increase of 225% when compared to the 16% of IFAs who currently already recommend the closed-ended products to investors.
It is the broad spectrum of investment choice that is cited as the main reason IFAs would recommend investment trusts, with 49% of those who either already recommend the vehicle, or who are likely to saying this is the attractive element. Similarly, lower overall costs (33%) and a proven record which has resulted in strong, long term performance (28%) were the second and third biggest reasons for IFAs to recommend investment trusts to their clients.
David Barron, Head of Investment Trusts at J.P. Morgan Asset Management, said:
"Investment trusts present new opportunities as they evolve and develop with the markets, and offer a wide choice to investors; from generalist trusts providing a broadly diversified portfolio to highly specialist trusts that can be used to target very specific areas of investment. Additionally, their structure can be more suitable than other investment vehicles for both new and more established areas of investment."
If you want to explore whether Investments Trusts would work for your portfolio Enables IFA’s in Bishop's Stortford can talk you through your options.
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