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Dynamic Planner Responds To Rory Percival Report

Ben GossPublished: 20 September 2017

Dynamic Planner highly rated in Rory Percival’s guide to risk profiling tools.

DT welcomes this independent guide from Rory Percival given his background as Investment Specialist at the FCA and the critical role that Dynamic Planner and other services now play as part of advice firms' investment processes.

Dynamic Planner is the most widely used risk profiling, financial planning and investment process in the UK, adopted by over 7,000 advisers. These advisers have profiled over one million clients using Dynamic Planner in the last 3 years alone. We understand the degree of trust which advice firms place in our service and the responsibility we have to ensure it is as robust as we can make it. We welcomed the opportunity to participate fully in the review.

We believe it is a thoughtful and valuable guide and should be helpful to advisers and firms who are looking to review their risk profiling and investment processes. The guide itself is the first independent, in depth study into risk profiling tools looking at 11 different functional areas and how they match up against the FSA/FCA’s 2011 guidance on ensuring suitability. It assesses each area on a ‘red amber green’ basis. Dynamic Planner gets a very positive review with 9 out of the 11 areas rated as green, in fact no other service gets a better score. Dynamic Planner is one of the few tools not to have any red flags against it where the function is not judged to meet the regulatory standard. Dynamic Planner stands out as the only service which clearly supports risk profiling for ‘no risk clients’ which is particularly important for IFAs in ensuring clients are given a fair, clear and not misleading assessment where they are moving assets from cash; a common scenario.

The importance of investment risk profiling. What is particularly clear from the guide is the importance of suitable risk mapping to asset allocations and then to investments. The guide points out that results can vary significantly and indeed that two out of the six tools reviewed don’t actually provide mappings. Dynamic Planner provides not only one of the most detailed mappings using our 15 asset class model, but the most comprehensive, formally profiling over 1,100 multi asset investments and portfolios each quarter from more than 110 managers.

Ten year track record. Unlike other services, Dynamic Planner regularly publishes the performance of its asset allocations against risk profile expectations and benchmarks. Dynamic Planner has a ten year track record which we encourage firms to review. Over £4.5bn is now explicitly managed against the Dynamic Planner allocations. The FCA’s Asset Management Market Review expects performance to be reported against risk based benchmarks relevant to the investor. More and more advisers are using Dynamic Planner to do this.

Assessing risk as part of a risk based cash flow plan. We support the guide’s view that the process of risk profiling ought to take place as part of a wider risk based plan developed with the client, one that takes into consideration their wealth, cash flows, lifestyle and needs. In the context of that plan advisers can ensure a suitable portfolio is constructed or investment selected which helps clients stand a better chance of meeting their financial goals for a level of risk they are willing and able to take. We hope this guide will encourage firms to utilise more of Dynamic Planner’s unique and integrated risk based cash-flow analysis to ensure the robustness of their suitability assessment and ongoing client relationship development.

Dynamic Planner clients get a 20% discount on the guide. Usual price £250. Use code ‘DP’ here.

 

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