Onside Issue 4 - 12
ONSIDE /INTERVIEW
The business relies on a good relationship with
Independent Financial Advisors (IFAs) and it's
an industry that's been through incredible
change. How do you adapt your business to
their challenges?
The IFA community has had a huge amount to take on
board with the retail distribution review (RDR) and with
pensions reform. To their immense credit they're emerging
with some very robust businesses committed to customer
service and delivery.
What are the key markets you see the business
operating in and how will you go about
securing new business relationships in this
ever changing environment?
One of the big conversations is that we're in a world of
low interest rates, so garnering income for clients is very
challenging. I think interest rates are at their lowest since the
foundation of The Bank of England in 1694, which is quite
something. And that's not going away. Future indicators in
the swaps market are that interest rates will remain below
2.5% for the next 10 years.
There are four key markets for us; IFAs, private client
stockbrokers, institutional investors and personal investors.
We have products and services that suit each of these markets.
So its a headache for IFAs looking to support their clients
in retirement by finding income, and the issue has become
more pressing with the changes to pensions regulation,
which is giving more investors more choice. The days of
simply buying a high yielding annuity are going away.
Our income fund is one solution. It's produced around a
5% income since 2002 through good markets and tough
markets. It's a well established fund and now we've started
paying the income out monthly instead of quarterly, it
represents a potential retirement solution in itself. We think
it solves a real problem for our IFA customers.
David Thomas
David.Thomas@senecaim.com
0151 906 2450
12
Steve Jackson is a big hire for us. He ran the IFA sales
business at Schroders. His experience and understanding
of this marketplace significantly extends our own. He
will work with our external sales agency LGBR to help
us reach new clients. We know our funds are scalable and
are confident this will be good for us, through the contacts
Steve and LGBR have between them.
We also manage an investment trust, the Seneca Income &
Growth Trust plc, that holds appeal for private client brokers
as it's essentially a portfolio in a single share with around
a 4% yield, so for smaller clients or those needing income,
it's a useful solution. The trust has also proven attractive to
private individuals who self-direct their investments through
online portals such as AJ Bell, Hargreaves Lansdowne and
Liberty Sipp. It's a sign of changing times that more people
are looking after their own money, and they seem to value a
trust that is well diversified, delivers a good income and has
low volatility. So we've commissioned two companies to
publish research on the Trust online, Martens and Edison,
to make sure this market is kept abreast of developments.
We approach the institutional marketplace through the broad
Seneca business network. This has proven successful over
the years, and we have a number of pension funds, charities
and family offices invested with us. For institutions with
significant assets we will run a separate account. Alternatively
some institutional investors go directly into our funds. It's
always worth having a chat to see if we can help.
Table of Contents for the Digital Edition of Onside Issue 4
Contents
Onside Issue 4 - Cover1
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Onside Issue 4 - Contents
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Onside Issue 4 - Cover3
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