Nutmeg’s discretionary service is available for a minimum of £1,000. Index funds and ETFs are used to push down the underlying investment charges, while Mr Port says “using technology helps bring down the cost of servicing clients and running portfolios”.
For him, the industry still has some way to go in terms of transparency. He says: “I think Mifid II is still going to be quite a shock for wealth managers. Displaying every single possible fee they are going to have to pay over the next 12 months is going to be a real technology challenge.”
Joanne Ellul is a freelance journalist
EXPERT VIEW
Mark Polson, founder of the Lang Cat
Mr Polson believes assessing the value of a DFM involves not what you get, but also what you pay.
“There are two links in the chain, DFMs and fund managers, that are not operating at the same standard of transparency and disclosure – with exceptions – to other parts.
“If all other parts are being transparent and disclosing properly and the DFM link isn’t, what will happen is the DFM will become irrelevant.
“I have seen advisers take back outsourced mandates as they start to understand they can create discretionary propositions themselves at a much lower cost, and take client ownership and ensure investors understand all the moving parts of that business.”
