Investors can be snow-blinded by the thousands of investments available to them. In recent Platforum research we looked at the sources of information investors use to help them make decisions, whether that be news articles, investment platforms’ own guidance solutions, or independent third-party rating houses amongst others.
The most popular information source for investment selection is ‘fund and shares news and analysis’, used by half of investors. Platforms have been expanding their editorial coverage of investments over recent years, and the weekend personal finance pages still hold considerable sway over investors’ portfolios.
This is followed by a ‘list of recommended funds hand-picked by experts’ used by a quarter of investors. Our recent research on non-advised platforms indicates the significance select lists have on flows.
However, despite the perceived benefits of select lists, a significant proportion question their credibility. Nearly half of investors believe investment services get some sort of incentive for the inclusion of funds on the list and over one in four investors don’t trust select lists because they don’t know how they are compiled.
So, for some investors, select lists are a valuable filter on the myriad funds available. Others view them as a pig in a poke!
We’ve recently published two reports on D2C distribution – more information is available here. If you have any questions, please get in touch.