Another chance to attend LinkedIn for Financial Advisers - 13th March 2012

Thu, 2 Feb 2012 14:38:21 GMT

If you missed our special LinkedIn workshop in London for financial advisers, we're delighted to announce that we are running another one on 13th March - kindly supported by Morningstar.

LinkedIn is no longer simply a Jobs site; it's an amazing business resource to connect you with the right people, raise your profile, enhance your online reputation, attract new clients and to find new professional connections.

But unfortunately most IFAs have no idea how to use this powerful website. Join us on 13th March and we'll reveal everything you need to know in order to fully leverage LinkedIn.

Take a look at this video from our most recent workshop

Event registration for The Complete Guide to LinkedIn for IFAs and Financial Planners powered by Eventbrite

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Investors in Gold Funds are spoiled for choice

Tue, 31 Jan 2012 13:57:02 GMT

Those that choose to invest in gold funds are particularly spoiled for choice when it comes to exposure to gold and gold mining shares.

In the last year it seems that gold funds have actually managed to beat the more popular equity and bond funds as far as profit is concerned. The bonds were actually caught in a flux amid changes in the interest rates but gold funds on the other hand generated more than 30% returns for investors.

The gold funds that include exchange traded funds (ETFs) and gold funds-of-funds have embellished the dismal report cards of most of the fund houses as far as growth and return in concerned. Last year alone most of the gold funds have actually gained 27-31 percent in value and profit.

The prices for gold are expected to hold strong this year, despite the economic instability and the inflationary pressure that is ragging across the emerging markets. Economy experts say that gold will retain its status as the best hedge against inflation and will still be considered a safe guard despite any strengthening of the dollar. The gold and the dollar are in an inversely proportional relationship when it comes to price. In normal

conditions, when the dollar loses its strength, the gold prices go stronger.

The dollar has remained the number one reserve of the world but not because it is the best of them all but because it is the least bad of them. Those that are interested in investing in gold in order to stay protected from the uncertainties of the economy. Gold market analysts believe that the bullish trends for gold will continue for the next 3 to 4 years. The negative correlation with other assets, the cultural demand for jewelry and the absence of a default risk are some of the other reasons why investors are so prompt to invest in gold.

The worldwide demand for gold has grown on a yearly basis by almost 11 percent to 4,000 tons of gold in India alone (2010). Two of the biggest gold consumers in the world are India and China. These two countries are the drivers of the demand for gold. The demand from the two adds up to 52 percent of the gold investment demand around the world. There has been an increase in India’s demand however, despite the urging prices. The reality is that the gold demand will surely not come down in India anytime in the near future.

In this country most of the investors choose physical gold, however in other parts of the world, the preferred method of investment is represented by gold funds, gold shares and bonds. The price for gold may decline slightly if the credit crisis in Europe clears up and if there is a bit of growth in the US and the emerging markets. However, this does not mean that we should stop making investments in gold, quite the contrary we should buy gold now when the prices are lower. Having a diversified portfolio will mean that your assets and savings are well-protected.

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A bespoke, tailored and individual share service

Mon, 30 Jan 2012 09:41:44 GMT

Working in the City I have become attuned, on the very odd occasions when I pop out for lunch, at spotting the difference between a suit and a suit. There are two types, off the rack and tailored.

The difference is there to be seen.

And it’s true; you generally get what you pay for, the £1,000 hand made suit looks like a £1,000 well spent.

But this got me thinking, does this apply with the management of money? Do investors get a better deal when they pay more, do they indeed pay more for tailored services? And the answer throws up a paradox, in the investment world there seems to be no more cost of a tailored, bespoke service than there is for an off the rack service.

In other words you can buy a hand-made £1,000 suit for the same price you can buy a £100 off the rack suit. Sound stupid? Yes, it does to me as well.

At SVS we run tailored, bespoke share management services, hands on with our clients, at no more cost to them than they pay a fund manager who has no idea who his client is. We build our service around the individual and give them an individual service, with all the information, support, research and management that they require, it is bespoke and personal. We fit their portfolio around them, rather than them fitting into some over diversified fund with thousands of investors.

And my point is? We do this at the same approximate charging level; they don’t pay any more for this!

The problem has been in the past that the introducer was encouraged to place their money with the off the rack companies simply due to the bias in introducer fees that existed. This is now disappearing fast and there will be no bias in the future. Therefore introducers can introduce their clients to an individual, tailored approach and receive the same remuneration.

SVS produce such a tailored approach, with proven results, we work with clients on an individual basis and with IFAs letting them (a) retain control of the client relationship and (b) sharing in remuneration for doing so.

We even do something more than this – with our new preferred partners scheme (www.svspartners.com) we share the clients and investors we look after with the IFA, we let our IFAs deal with the clients.

If you want to find out more about how you can work with such a tailored approach please come to our web site for our Preferred Partners www.svspartners.com and register your interest in our service and we can take things from there.

Philip Pooley
Director

SVS Securities Ltd

[Sponsored article on behalf of SVS Securities Ltd]

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What to consider while Investing in Emerging Market Debt

Wed, 25 Jan 2012 20:34:04 GMT

Emerging market debt owes its origin to the multinational banks in the U.S. and Europe, which had started lending to the developing countries in early 70’s. At that time participants used to refer to this, as the LDC (less-developed countries) debt market (www.ovlg.com/debt-consolidation/).

Now after globalization the scenario has changed and equity no more remains the only game in town, especially when it comes to emerging markets. Emerging market debt investment has now risen to prominence. It’s all about lending money to the government of developing or recent manufacturing countries, which have the potential to enter the world market like China, India and Mexico.

However, it’s true while the potential for profit is greater here in comparison to any other investments, so is the risk. It is important to research the advisor’s previous track records and the political and economic climate of the countries; you would like to invest, before you invest in. Manage your risk while investing in emerging market debt can be achieved through the following.

Proficient Investment Advisor

Your first and foremost duty is to choose an experienced investment advisor (www.kjhfinancialservices.com), with a solid track record in investment. Make sure you avoid advisor, with no such experience in emerging market debt.

Research about the country

Your next step should be investigating the countries you would like to invest in.
You can consult US government commercial guides, prepared each year by the embassy of each country, for further information. As emerging nations are often susceptible to political and economic crisis and natural disasters, make sure you stay up to date with international current affairs and those related to the respective countries. Devote sufficient time and effort to conduct an extensive study on the nation, because it’s usually worth the time and effort.

Risk factors

Risk factors are quite high in emerging market debt investment; therefore, make sure you invest only what you can afford to lose. Plenty of examples are there, when unforeseen disasters ruin the emerging market debt investments.

Growth of the fund

You must conduct an extensive research on the overall growth of the fund, and then make your decisions based on long-term investments. Remember, statistics says some of the best performing funds are those that combined investments in a number of countries and added and deleted as required to ensure the constant growth of the fund.

Prompt action

Last but not the least; stay prepared to make quick decisions and changes while investing. Remember, a good advisor can only help you to stay updated within the rapid changes of the market, but after all, it’s your money, so the ultimate decision needs to be yours.

Keep In Mind

You will be surprised to know that emerging markets debt is a voluntarily accessible asset class through mutual funds. The names of some famous fund managers include PIMCO, Alliance Bernstein, Western Asset Management and DWS Scudder. All these offer funds that access a variety of countries and product types. For example, PIMCO offers three different emerging markets debt funds, each of which individually focuses on: local currency (domestic) bonds, U.S. dollar-denominated bonds, and a mix of direct currency exposure with diversified bonds, loans and other instruments. Always remember, bonds do not trade like stocks. The process of investing in individual securities involves huge time, money and complex procedures, therefore, make sure you don’t lose focus, while investing in emerging market debt.

Final Thought

It’s true that emerging market debt has come a long way since the Mexican debt crises of the '80s and '90s. These days the improved legal, regulatory and economic climates of Asia, Latin America, Eastern Europe and elsewhere have stabilized this market to a great extent. If you want to make the emerging market debt a more compelling long-term investment prospect, stay focused and keeps the aforementioned points in mind.

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Financial Advisers - Do not ignore your website visitors

Wed, 25 Jan 2012 08:04:42 GMT

Hello, how are you? Hope you are well and that you have had a good day so far. Now, tell me, isn’t it nice to be asked, to be recognised, to be noticed?

I am writing this from the Rudding Park Hotel, near Harrogate, where I am speaking tomorrow morning. I arrived to be met by a cheery smile, to be asked “how has your day been today Mr Jones?” and to be escorted to my room with a bright conversation about the area.

Once in my room I rang room service: “Good evening Mr Jones, how are you this evening?” was EXACTLY how the phone was answered..! Wow, what a hotel…! I was so impressed, the FIRST THING I did was to open up my laptop and write a FIVE STAR REVIEW on Trip Advisor. The hotel had made me feel welcome, as though they were running the hotel just for me. So many hotels simply seem to ignore their visitors.

And, sadly, so do many online businesses. The chances are you have emailed some website or other, never to get a reply. Or you have asked a question in a company’s support forum or ticket system, only to have to wait weeks to get an answer, if at all. Many companies simply build a website and leave it there; it’s rather like building a retail store, dressing the windows so people can see what you have to offer and then letting people in the doors only for them to find there are no staff.

Human beings do not like being ignored. And this is confirmed by a new piece of research from psychologists at Purdue University, Indiana, USA. They found that people feel good even if they get a sense that strangers warm to them. Being ignored by people walking past meant that the participants in the study felt negative. It shows that simple connections are all you need to make people feel more connected with you.

Online that means the language you use – hopefully you feel I am writing this directly to you, you can almost hear me speak it to you. Also, it means answering comments as quickly as possible, dealing with emails immediately and doing everything you can to make people feel you are not ignoring them. Much business online is missed because websites simply ignore their visitors.

If you want to discover how it feels to NOT be ignored, to be welcomed and treated as a friend, check yourself in to Rudding Park…!

Graham Jones
Internet Psychologist

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Aviva Investors discuss 2012 - Time for active management, identifying growth, value & opportunity

Sun, 22 Jan 2012 15:44:49 GMT

Aviva Investors discuss 2012 - Time for active management, identifying growth, value & opportunity. Watch this video below or click here.

[Sponsored video from Aviva Investors]

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How do you value income?

Thu, 19 Jan 2012 11:34:37 GMT

Capital that does not produce income is pretty much worthless. What about Berkshire Hathaway, Apple or gold many will shout? The truth is that no one is more aware of the importance of dividends than Warren Buffett. That is why he doesn’t pay any. In the case of Apple, and many other technology companies, the executives know that product cycles are getting shorter and shorter and that they need to conserve cash to develop the next product. And there is no guarantee it will sell as well as the last one. Ten years ago markets valued Nokia and RIM at 50 years of such earnings. Now, they are struggling to adapt to a re-vitalised competitor that itself was near extinction just fifteen years ago. The argument for gold is simply that while it might have a negative nominal yield it has a positive real yield as inflation preserves its value.

In any event these examples are at the fringes of most people’s portfolios. What matters most to the average investor is how to split a portfolio between bonds and equities. There are all sorts of rules of thumb on this and the growth in asset allocation strategies, some driven by cash flow forecasts, has made it an increasingly important topic.

At the core of the argument, and looking at things in a purely UK context, is how much value should be placed on the £47 billion of income that HMG pays out on its borrowings compared to the £76 billion of dividends generated from companies in the FTSE 350 Index. In other words if equities provide 62% of the£123 billion income stream should they form 62% of the assets? As 2011 evolves into 2012 the relative valuations are vastly different. While the nominal value of UK sovereign debt stands at £1 trillion its market value is higher at £1.138 trillion. Contrast that to the current £ 1.73 trillion market value of the FTSE 350. In total these two markets are valued at £2.868 trillion of which 60% is in equities.

Those figures must be accurate because there is an army of brokers, fund managers, journalists, commentators and rating agencies looking at the data every second of the day. That is not to say though that it won’t change.

We know that debt payments from HMG are going to rise to about £60 billion over the next five years because the OBR has told us that on the basis of the projected 50% rise in net public debt. There is though no consensus of what dividend payments from UK Plc might be over the same time scale.

There is one other factor we can put into the equation and that is inflation. While we don’t know how much it will be, we do know it will exist. For the sake of argument let’s assume it totals 10% over the next five years. That is pretty much what index linked gilts are telling us it will be. Let us also assume that earnings, and hence dividends, will match inflation so UK dividends will rise to £84 billion.

On that basis the relative positions of the two income streams will change a little. In five years time dividend income from UK corporations will fall slightly in relative terms to 58% of the £137 billion of total income.

Trying to extrapolate a capital value for these capital markets from such a hypothetical exercise is almost futile, but not quite. But let’s do it anyway. Forecasting the size of the gilt market in five years is easier because the Office of Budget Responsibility predicts that it will grow by 50% in nominal terms. That would take it to £1.707 trillion. The big question is where will that additional capital come from? Will it be from equities, overseas markets or internally generated growth? It is certainly a lot of capital to find and there is the risk that the massive expansion in gilt issuance could just crowd out equities by depressing yields across the board and leave capital values where they are, or even lower. However, even in that worst case scenario equity income would still be a lot higher than gilts in relative and nominal terms.

To maintain the relative positions, i.e. for equities to still represent 60% of the total capital the FTSE 350 would need to rise to £2.3 trillion or 35%. If mimicked by the FTSE 100 it would represent a value on that index of over 7,600.

An alternative method is to use yield to compare two income streams. At the beginning of 2012 gilts yield 2% and equities 3.8%. As these two markets evolve, and equity income becomes larger than interest income, it is reasonable to postulate that it will become even more valuable. In other words its yield will fall. If, for the sake of argument, it fell to the 2% level that 10 year gilts now trade at it implies a 90% uplift in the capital value of the underlying assets. That would take the FTSE 350 up from today’s level of nearly 2913 to 5,535. Expressed in the more familiar language of the FTSE 100 it implies a rise from 5,500 to 10,450. How’s that for a New Year’s wish?

Do you want access to hundreds of new investment clients in your area now?

Tue, 17 Jan 2012 08:01:46 GMT

The great thing about the RDR is that it is forcing all of us to look closely at our client service proposition.

At SVS we have realised that our service offering will be radically improved if we extend the IFA advisory option to all of our clients and prospects. However our permissions, whilst considerable and wide, do not include generic investment advice, retirement advice, cash flow financial planning, holistic or general financial planning, and trust or tax services. We are a city based firm offering share services, both advisory and execution only, CFD and FX trading facilities and corporate advice.

It therefore makes perfect sense for us to offer the IFA service in addition because it is complementary not competitive and we have thousands of clients and prospects in every region to do this with.

Just to emphasis this we have a database of clients and opted in investors (i.e. those who have asked to receive our regular bulletins and updates) of 240,000 individuals in the UK. We now want to offer these investors the IFA service proposition and rather than do this direct we have decided to do this through a select group of ‘partner’ IFAs.

This means we can combine our service offering with an IFA’s in each region, so any IFA looking to immediately lock in and offer their service to hundreds, possibly thousands of new investors would find this of huge attraction. There is a lot more to our partner scheme than this but this is the heart of it, using the RDR service requirement to combine our services to great effect, great for us, great for you, the IFA, because suddenly you get a very large number of new investors to deal with, and most importantly great for the client.

To find out more about the SVS partner scheme and how you can access all these new clients please go to www.svspartners.com and fill in the short enquiry form and all the details will be emailed to you there and then.

Philip Pooley
Director

SVS Securities PLC

[This is a sponsored article from SVS Securities PLC]

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Becoming a Lean, Mean Referral Machine

Fri, 13 Jan 2012 18:30:25 GMT

I logged into Amazon.com recently to see how many books have been written about referrals and found that nearly 4,000 books are available on getting referrals. Why then do 80% of all financial advisors not actively ask for them, according to a recent study I read?

Referrals are the best marketing system selected by advisors when surveyed (particularly for the high-net-worth client). They are virtually free to implement. And, I believe an astute financial professional will have at least three referral systems that they have tested successfully and use every day.

The first three systems I will share are active, meaning you will need to ask. The second is passive, meaning you can put it on autopilot. The next is geared toward receiving referrals from other professionals or centers of influence.

Let's begin by discussing active referral systems. The first and simplest system is using LinkedIn, if your firm allows it. (If they don't allow it yet, you will need to wait until it is approved.) LinkedIn.com is a professional networking site. The first step is to join (it's free) and fill out your profile as complete as possible being careful to follow your firm's guidelines.

The most important feature of your profile is your picture! Post the absolute best professional picture possible. Try to get your profile as close to 100% complete as possible, and then in the customize area change the URL to a personalized one to include your name. If someone Googles you, your profile should then pop straight near the top.

Read the full article at the excellent Financial Planning.

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How to Plan, Promote and Present Successful Client Seminars in an RDR World

Fri, 13 Jan 2012 15:47:01 GMT

2012 is proving to be the Year of the Seminar!

IFAs are using seminars to attract new clients and professional connections, to add value to existing clients and to communicate their business proposition in a post RDR world. Whilst Providers are also using seminars to help IFAs with RDR and other business development challenges.

Seminars and workshops are a proven way to raise your profile locally and for prospects to see and experience your professionalism and expertise live. But whilst almost everyone believes in the power of seminars, hardly anyone knows the secrets of how to get a full house of the right kind of prospects using both traditional and new media marketing.

In this startling webcast in conjunction with Thought Leadership Live, Philip Calvert, founder of IFA Life and author of the acclaimed book Successful Seminar Selling reveals how to plan, prepare and present compelling seminars - including how to get a room full of people, how to use Social Media to fill up your seminars and how to get conversion rates approaching 100% - plus how to create an exciting new income stream from speaking at seminars.

Don't miss it!

Google+

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A seller's checklist... What does it look like?

Thu, 12 Jan 2012 10:37:17 GMT

So an IFA has decided he wants to sell his business and you know him or have been introduced to him. From the summary information and guide price it appears a viable acquisition and you are looking forward to meeting him.

So what's he likely to be thinking? You will probably give considerable thought to the questions you are going to ask, maybe even how to structure a deal, but have you considered what the seller may be thinking?

When initially meeting a new investment client you will have a wealth of experience to fall back on to understand their situation, help allay their fears, and prove your service can meet their requirements. You will have experienced many similar meetings and fine tuned your presentation, allowing you a degree of confidence in a successful outcome.

Are you as equally prepared to do the same with an owner looking to sell? Probably not, in our experience.

To help enhance the initial meeting for both buyers and sellers alike we provide our buyers with supporting material to act as a reminder for the basic questions they should ask and points that the seller is likely to want answers to. The more prepared you are, the more professional you will appear, and therefore the more likely to succeed in completing the deal.

Also some sellers do not wish to appear to be rude with questions like;” so what happens if your company goes bankrupt?” However, if you raise this issue and have a sensible solution you will be ahead of the competition.

Our members will all understand the 3 main areas of common concern to sellers and be fully prepared for them in 2012:

Security; Fair Value; Reputation

This topic, amongst others will be discussed in our live 45 minute webinars on January 13th and February 3rd 2012. Our webinars are exclusive to our subscribing buyers and invited guests. Further details can be found at

http://brokers4sale.com/index.cfm/live-monthly-webinars/

Gary Medcraff is a founding partner of Brokers4sale.com. He has been exclusively involved in mergers and acquisitions for the last 10 years and has over 25 years experience in the IFA Market.

[This is a sponsored article from Brokers4sale.com]

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'Our hi-tech future' Speech by David Willetts at the Policy Exchange, 4 January 2012

Wed, 4 Jan 2012 14:55:14 GMT

In a speech at Policy Exchange, Universities and Science Minister David Willetts argued that our greatest national assets - our universities, our science facilities and researchers - are the best single hope for making our way in the high-tech world of the future, creating jobs and opportunities and boosting high tech economic growth.

Economic Growth

Growth is the Coalition's highest priority for 2012. It is going to be a year of serious economic challenges. We are better prepared for them than most because we took tough decisions on the deficit early on. We have set out our plans for getting a grip on public spending and we are sticking to them. That will enable us to bring down the enormous deficit we inherited.

Sorting out the mess in the public finances itself helps get the economy moving as it helps to keep interest rates low. But that is not the whole story. There are a host of ways in which the Government is supporting growth by raising the performance of the economy: cutting red tape, a tax and benefit system that rewards work, high quality education and skills, reforming the planning regime so that our new infrastructure can be built expeditiously. George Osborne and Vince Cable are driving forward such an agenda across Whitehall in the Growth review.

That list of our growth policies applies horizontally across most sectors of the economy. Investing in energy or transport or better schools is a good thing without taking any view about whether the future of our economy is manufacturing or life sciences or financial services. There is widespread wariness of so-called "vertical" policies that focus on particular sectors and technologies and it is very understandable. The more specific the return, the greater the chance that it can be financed privately. Moreover, we fear governments do not have the knowledge to back particular technologies and have made a mess of such policies in the past. Governments picking winners can easily become losers picking Government programmes.

Recent British Governments have therefore preferred generic growth policies rather than vertical ones which focus on particular sectors or technologies. These are essential foundations but it only takes you so far and today I want to show how much further the Coalition is going and why. Soon you find that you are having to take some kind of view about specific sectors and technologies too. Which source of energy do you encourage? When it comes to transport which places do you link up and why?

The Jubilee line extension has been great for London but I well remember how its original impetus in the 1980s came from the need to provide access to Canary Wharf: if it had been a link to a manufacturing centre not office blocks for financial services it might have been seen as a much more controversial example of industrial policy. We have achieved an extraordinary surge in apprenticeships but I am struck by how many commentators believe they should be in particular sectors such as engineering or life sciences: indeed part of the appeal of apprenticeships is their historic association with such sectors.

Governments find themselves making decisions about allocation of resources and we should not pretend we do not. The Coalition's pledge to rebalance the economy depends on taking such a view. Indeed when money is tight these type of decisions are even more acute. And in the rest of this speech I want to set out how we do this in our strategy for the UK's science and research base and how it can help generate high tech growth.

People do of course ask: "So where is the growth going to come from?" Nobody can know for certain. But that does not mean that we do not have the faintest idea. A lot of it will come from our established, high performing sectors which continue to innovate and improve productivity. We can discern already some of the scientific discoveries and technologies that will shape our future. Today I want to set out what we are doing to secure this future for us and I am grateful to Policy Exchange and the Campaign for Science and Engineering (CaSE) for the opportunity to do so. This tackles that deep-seated anxiety about the prospects for the younger generation in the global economy of the future.

When you ask people what worries them most it is that their children will not have the same kind of opportunities in life as we have had. I understand that fear - indeed I wrote a book about it. But our great national assets - our universities, our science facilities and researchers, our extraordinary accomplishments in the arts and humanities - are the best single hope for making our way in the high-tech world of the future. They might not solve all our economic problems next year, though they can help even with this. But if properly nurtured they can ensure that Britain will be up there as a leading location for research in the physical and life sciences and beyond. Britain can be the preferred location for companies' R&D. We can have world-class industries using cutting edge technologies. We can have a prosperous future with a role in the world.

Our research base

Our research community is the most productive in the world. In the words of the recent Elsevier report, "The UK is the clear leader among all eight comparator countries (Canada, China, France, Germany, Italy, Japan, UK, US) on citations per unit spend on Gross Expenditure on Research & Development." With 3% of the world's researchers, we generate 6% of the world's academic articles, 11% of citations, and 14% of the most cited papers, second only to the US. Quite simply we have more articles per researcher, more citations per researcher and more usage per article than researchers in US, China, Japan and Germany. We can be proud of this achievement.

It is very broadly based too. The Elsevier report states: " Relative to the world average, the UK has generally a well rounded portfolio, with a strong and increasing emphasis in clinical sciences, health & medical sciences, social sciences, business and humanities." They identify no fewer than 400 research areas where we have a distinctive research strength, and many of them are world-class. It is quite extraordinary for an economy of our size to have strength in so many different areas. No other country of our size has achieved this. It is particularly important as so much research is increasingly interdisciplinary. Our goal is nothing less than to ensure we have a continuing presence in the key areas of scientific research. We should not have the illusion that we can lead in all the scientific and technical advances of the future. But such chauvinism is unnecessary. What we can aim to have is the absorptive capacity to understand and draw on scientific and technological advances across disciplines and across the world.

This broad research base emphatically includes the arts, humanities and social sciences. They are all part of the science and research ring fence. Increasingly for example research in the physical sciences is linked to human behaviour - not just designing a low carbon vehicle but understanding what makes people choose to drive it - or not. In allocating research funding I have therefore followed the advice of the learned societies and others that we should not shift the balance of funding between the main disciplines. Eric Schmidt of Google caught the mood in his MacTaggart lecture when he said that this arts v sciences debate really ought to be dead and buried and instead we should recognise how complementary they are. I like the idea that instead of just thinking about STEM, Science, Technology, Engineering, and Maths, we should add the Arts so it becomes STEAM.

One reason our research is so good is that ministers have so little scope to interfere. Our science and research programme budget of £4.6 billion is not just protected in cash terms, it is also protected by the Haldane principle that Ministers do not decide on funding for particular research projects or particular university departments. It also rests on the gold standard of peer review. We are talking here about free enquiry where you are judged by your peers not by the minister for science nor the government as a whole nor by academic patronage. This last protection is underestimated. We do not have a baronial system in which ageing professors dispense posts and patronage and younger academics have to defer to them for decades as they patiently wait their turn. One reason why so many young researchers from across Europe choose to work in the UK is that opportunities for them are much greater here. We will continue to support and monitor the compact on conditions for young researchers, especially women for whom the requirement to be mobile around the country with little allowance for family responsibilities can be particularly onerous. I welcome the latest initiative by HEFCE to make better allowance for maternity leave in assessing researchers' output for the Research Excellence Framework.

We must continue to sustain our research base in tough times. If you look at the decisions the Coalition has already made you can see how committed we are to science and research. In fact I can confirm the Government's aim is quite simple if very ambitious: it is that we should be the best place in the world to do science. This ambition is about more than money. It is about respect and celebration of the spirit of scientific enquiry with everything from world-leading science journals and lively science writing to world class museums and events. It is something Government has to practise too with science advisers in every department, the Foresight horizon-scanning enquiries of the Government Office for Science and evidence-based policy drawing on latest advances in science such as behavioural economics. It also means:

Tackling the pernicious effects on scientific enquiry of the current law on libel.

Continuing to keep our country open to leading scientists who wish to work here and making a big contribution to global science projects such as managing the Square Kilometer Array and the key role of our scientists in CERN and in the JET and ITER projects for nuclear fusion.

An ever wider interest in science with growing attendance at our burgeoning science festivals and Fairs, extensive coverage of science on the BBC and the media more widely.

More students doing science at school, college and university, with new science departments opening as Lancaster University are doing in Chemistry.

Imaginative exercises in citizen's science such as Galaxy Zoo which started in Oxford with volunteers classifying new galaxies.

World-leading Learned Societies such as the Royal Society, which has just celebrated its 350th anniversary and a network of leading charities such as the Wellcome Trust and Cancer Research UK backing scientific research and enquiry.

It does of course also mean proper funding for science and research. I realise that there are always pressures for more and we cannot afford to do everything we would like to do. Nevertheless, as countries around the world face budget pressures, our ring- fenced cash-protected science and research funding budget is a good settlement in tough times. The breakdown of current spending is between four main areas roughly as follows. £1.6 billion goes direct to universities in recognition of research excellence. £150 million goes through Higher Education Innovation Funding to reward universities that have knowledge exchange with the wider world, especially contributing to economic growth. £100 million goes direct to the Learned Societies (the Royal Society, the Royal Academy of Engineering and the British Academy) to fund leading researchers and also make small grants for particularly worthwhile research projects.

The Research Councils and the UK Space Agency between them spend the remaining £2.75 billion. The Research Councils divide this into two main categories - responsive funding and directed funding competitions. They estimate that about two thirds of their funding is in responsive mode and a third in directed mode. The directed mode focuses on the grand challenges such as energy, living with environmental change, our ageing population and lifelong health and well-being. Blue skies research can however be covered by both categories - our contribution to CERN is directed to a very specific project but is also pretty fundamental. And Research Councils do respond to bids for funding for some quite applied research.

Research Councils devote a lot of time and effort to identifying significant ground-breaking areas of research that they should support. They scan the horizon to try to ensure we have a coherent and broad research base in this country. They work with business and Government to identify these priorities. But there comes a point when the Research Councils have to think about impact and priorities. I know this is controversial - and I do receive mass letters from aggrieved sections of academia who fear the Research Councils have failed to recognise their special significance. But it has to be done and the Councils try to do it in an open way that commands the consent of the research community they serve. We must never end up in the position where an individual researcher with a novel idea judged to be of real academic merit is excluded from funding just because it does not fit some preordained plan.

Today I am releasing reports on the impact of this Research Council funding. We are familiar with how American research funding helped with the creation of great American businesses like Google. But we have similar examples here. The UK's largest software company, Autonomy, was started by Dr Mike Lynch at Cambridge University in 1996 based on work conducted during his PhD supported by the Engineering and Physical Sciences Research Council in the UK. Autonomy was sold to Hewlett Packard in August 2011 for over £7 billion. The EPSRC have just been recognised by Proctor & Gamble for their globally best in class support to P&G by a government body. Innovations in solar energy panels and offshore renewable energy are being supported with substantial research funding.

Impact doesn't just mean commerce. Professor Theo Farrell, an ESRC/AHRC Fellow undertook an assessment of the British Army's performance in Operation Moshtarak, a 2010 offensive to clear the Taliban from central Helmand Province in southern Afghanistan. The resulting classified report was briefed to Army chiefs, and has informed doctrine development and pre-deployment training.

Our ring-fence protects research activity. When money is tight we had to give current spending on activity high priority. That is one reason why for the first time the ring fence includes the main forms of current spending on science and research. But the ring fence excludes capital as there is some discretion in the timing of major capital projects. The Government does however understand the importance of investing in science capital as is shown by George Osborne's excellent decisions over the past year to invest a further £470 million in science capital in top of our original plans. That will go on new facilities, the e-infrastructure needed for world class science, and the further development of our National Campuses at Harwell, Daresbury, Norwich and Babraham. This will bring together world class facilities and researchers and the companies that can benefit from them - contributing further to our high value added growth agenda.

Much of the money from the Research Councils as well as from other sources flows to our universities. In some countries like Germany research tends to happen outside universities - in their Max Planck institutes for example. We have our own outstanding independent research institutes as well, from the Institute for Fiscal Studies to the Institute for Animal Health. The new Crick Institute will be a world leading centre for life sciences. But by and large publicly funded research in Britain is likely to be conducted in our universities. That in turn puts them at the heart of our high tech agenda. Only the other day Professor Eric Thomas, the President of UUK, perhaps influenced by too many Dickensian Christmas cards, told me that if the British economy has been a stagecoach stuck in the mud then our universities are one of the horses that can pull it out. He is absolutely right.

We currently have 12 universities in the top 100 and 32 in the top 200 according to the Times Higher Education rankings. It is 19 in the top 100 and 30 in the top 200 according to QS. And in the Shanghai rankings it is 10 and 19. The exact numbers and individual universities vary according to the different weighting in the different schemes. But all the university rating agencies agree that only the US does better than we do. Today I set our ambition of aiming for the number of our universities in the top 100 to grow. When you look at our relative weaknesses in these league tables it tends to be teaching and external income. These are the areas where we need to raise our game even more. We are not managing decline we are investing in success. A crucial reason for our controversial changes to the funding of teaching in universities is to ensure they remain well funded even when money is tough. There is no more fair and progressive way of financing university teaching than to expect graduates earning over £21,000 to pay back for it.

We are fortunate in having one of the strongest networks of universities in the world. Part of its dynamism has been the ceaseless process of creating new institutions as well as the capacity of existing institutions to grow and develop. University College London was created as a secular alternative to the Oxbridge duopoly. Then we had the great civic universities, the Colleges of Advanced Technology, the plate glass universities and the polytechnics. We have also had new research institutes, campuses, and science parks. That process of creating new institutions should not stop even when times are tough and there is no spare public money. We have to bridge the gap between limited public funding and continuing strong demand for higher education and research.

Globalisation is still at its early stages when it comes to Higher Education. The next round of new institutions may well link existing British universities with international partners. The surge in international investment in science and technology would make this a key part of the mission of a new foundation. It might be that today's institutions propose a new campus or a new international partnership. Or it might be new providers wanting to enter with different models. Today I can announce therefore that the Coalition is inviting proposals for a new type of university with a focus on science and technology and on postgraduates. Local economic partnerships, universities, businesses and international partners can come together to put forward proposals for new institutions.

There will be no additional Government funding. This time we will be looking to private finance and perhaps sponsorship from some of the businesses that are keen to recruit more British graduates. For example, we will not be diverting funding from support for undergraduate students. It is an opportunity to seize the new freedoms which we proposed in our White Paper last year. We already have a lot of interest and we want to move this to the next level. As proposals are developed we will be able to identify any specific obstacles that need to be removed including by legislation where necessary. A major city might wish to offer a site as Mayor Bloomberg has just done so successfully with his competition for a new graduate school in New York. We will be discussing with the interested organisations how best to carry this initiative forward. I am confident that with ingenuity we can grow our research base and our universities even when times are tough.

Linking the research base and the wider economy

There is enormous scope for universities to go further and build even stronger links with the wider economy. They are after all at the heart of the innovation clusters which will drive our economy in the future. Their external income has increased to £3 billion. But there is more we can do.

We have our own challenges. We have relatively low rates of paper co-authorship between industry and academia. We generate just 2.2% of global patents. Business spend on R&D, at £16 billion, is low as a percentage of GDP. This problem has been debated for a long time. The great economist Alfred Marshall wrote in 1919:

"the small band of British scientific men have made revolutionary discoveries in science; but yet the chief fruits of their work have been reaped by businesses in Germany and other countries where industry and science have been in close touch with one another."(Alfred Marshall, Industry and Trade).

We are tackling this age-old problem that we are good at generating great ideas in our universities but less good at turning them into the products and businesses of the future. And we can point to successes such as ARM, Autonomy, Rolls Royce, GSK Jaguar Land Rover and many other companies which have exceptional links to our universities. But we need more of them. We are reforming IP and backing open innovation in our universities. We are liberating them from the idea that the only measure of their contribution to the wider economy is setting up a tech transfer office and then counting patents. We are extending Innovation vouchers to encourage more small businesses to draw on the resource available in our universities. There is still untapped potential in universities that can be drawn out by organisations like Imperial Innovations or Isis Innovation. I can announce today that our ambition is for university knowledge exchange income from external sources to grow by 10% over the next three years.

The classic model expects venture capitalists to be following what is happening in universities and to invest in the IP after the university has spun out a company. This is the conventional sausage machine and it can work on some occasions but it is not widespread or straightforward. We have expected venture capital firms to finance early stage start-ups much further upstream than is realistic. Then we beat up on ourselves that our venture capitalists do not take risks they do in the US when even there the model is rather different.

In the US Federal funding comes from a wide range of agencies - the National Institute for Health, the National Science Foundation and of course DARPA, the Defense Advanced Research Projects Agency. They can support research closer to market than Research Councils do. What Americans mean by defence is whatever is necessary for national greatness including ensuring a capacity in any blue skies technology. And then the SBIR the Small Business Innovation Research programme means American start-ups have a chance of getting Federal contracts for their innovative products even as they are still developing them. All this means that you can get federal funding to see you through from idea to product. This eases the pressures on venture capitalists. America does have a much bigger venture capital sector and it is a great advantage to them. But we should look behind the rhetoric at what has been called America's " hidden developmental state" explained here by Professor Mazzucato. The land of free enterprise has an innovation and research system which depends on federal and state government just like everywhere else in the Western world.

The Technology Strategy Board bridges this gap between the Research Councils' funding for activities in universities and fully commercial development by business. They are working with Research Councils and aligning their funding where that is possible. A crucial weapon in their armoury will be Smart Awards which provide proof of concept and proof of market funding for businesses, then support for the further development of prototype products. Often SMEs are caught in a Catch 22 dilemma where they cannot leverage investment until they have this proof but they haven't got the relatively small sums you need to pay to get the proof. It was David Young who first introduced Smart Awards in the late eighties to bridge this gap. They were very successful. The very achievement of getting a Smart Award was a signal to perhaps an angel investor that this was a project worth investing in. Under the last Government they were dissipated amongst different RDAs and lost their brand name. Now we are bringing them back as a nationwide scheme run by the TSB.

These Smart awards span all sectors. But as well as these broadly based schemes we also have to spot specific areas of scientific and technological advance. Nobody can know for sure what are going to be the big technologies of the future but that is not a reason for inaction. Let me now explain the three stages of our high tech policy as we look out for the future prospects.

Identifying key areas of scientific and technological advance

There is a big difference between business sectors and technologies. They overlap but are not the same. We have some crucial business sectors that are seen as high tech - such as aerospace or space. We also have perhaps less glamorous business sectors where innovation is increasingly important - delivering social care, agriculture, utilities, transport and distribution. Part of Britain's weak productivity performance has been low levels of investment and innovation in some of these sectors. But they can be transformed by absorbing new technologies - the warehousing and distribution of goods around the UK has been transformed over the past twenty years by new IT systems. Increasingly satellites and space-based systems will transform the accuracy of the spreading of fertiliser and patterns of planting in agriculture. These changes will happen not as the result of technologies developed specifically for say the agricultural sector but as a result of the application of technologies developed elsewhere. They may well be general purpose technologies that spread widely across the economy as electricity or satellites or the internet have done. We need to judge the technologies that will matter in the future. We may not get it right - we won't always - but we have to try. We are not picking individual business sectors but Government is backing the development of specific key technologies.

In the US they developed a neat way of summarising the big technological advances - the National Science Foundation called them Bio, Nano, Info, and Cogno or BNIC for short. We have heard about the BRICs, the countries where the future growth will come from: the BNICs are the technologies it could well be coming from. This has been a theme of American science policy for over a decade now and it has generated some rather overheated debate about the possible convergence of these technologies. There may be something in this. We can see for example the "wet" biological sciences linking ever more closely with the data processing capacities of "dry" IT as a " new biology" emerges. Other countries have conducted similar exercises. The High Tech Strategy for Germany lists the following cross-cutting technologies: nanotechnologies, biotechnology, microsystems technology, optical technologies, materials technologies and production technologies.

We did our own exercise and published the results last year in a report, "Technology and Innovation Futures: UK Growth Opportunities for the 2020s". It was very British, inductive not deductive, listing the main areas of technological and scientific research over the next decade, drawing on consultations with the academic community. Our experts in the Government Office for Science identified 53 specific future technologies and innovations. They then put them in the following broad categories:

Biotechnology and Pharmaceuticals;

Materials and Nanotechnology;

Digital and Networks;

Energy and low carbon technologies.

Overall our horizon scanning broadly matches that of the world's biggest scientific power. America's Cogno and Info very roughly come together as our Digital and Networks. Unlike the US we identify a distinctive low carbon technology area so the C in BNIC could stand for Carbo instead. These lists are inevitably imperfect. They change. But they are important. They act as a check on eccentric or lop-sided decisions by making sure we have a clear overview of the main areas we need to invest in. If we are to live up to our ambitions we need coherent programmes for investing in these broad areas of research. That is what we are doing.

Judging whether to back specific technologies as they get closer to market

Then as you get closer to market you try to back in particular the technologies which have the greatest potential. This is where the TSB has to exercise a professional judgement on what to support. The TSB's job is to help "turn today's emerging technologies into tomorrow's industries."

Rigorous scrutiny of the cost-effectiveness of investment is necessary. The TSB and BIS apply some crucial tests. The key criteria for backing a technology are that we must have an academic and research presence; the business capability to develop products and services based on the technology; and a good chance of a sizeable global market.

On that basis the TSB identifies technologies where they see particular potential for the UK. Their most recent assessment suggests for example particularly promising technologies for us are synthetic biology, energy efficient computing and energy harvesting.

The TSB is also setting up a network of elite technology innovation centres, now called Catapult Centres. We have already created three, and I can announce today that the fourth will be in the area of satellite applications. This will provide business with access to in-orbit test facilities to develop and demonstrate new satellite technologies. It will also provide access to advanced systems for data capture and analysis, supporting the development of new services delivered by satellites. These could be in a wide range of areas such as distance learning and telemedicine, urban planning, precision agriculture, traffic management and meteorology.

Practical leadership from Government

Then Government can help drive forward the development and application of key technologies. I tend to follow quite a standard model for doing this because it seems to work. I first discovered it in the space sector, where a Space Leadership Council was formed in March 2010. It had been set up by Paul Drayson when he was science minister in the last Government. It has been the basis for a template used more widely in BIS - not just by me but by Vince Cable and Mark Prisk as well.

You start by convening a group which has to include leading academic researchers, Research Councils, agencies sponsoring commercialisation like the TSB and of course businesses themselves. They discuss what is happening so everyone can understand the links between the research agenda and commercial opportunities. You ask if they would like to meet again and they normally do. Then you set it up a bit more formally as a leadership council usually co-chaired by a BIS minister and someone from industry. The Council then commissions a technology road map. It is usually written by an expert advised by a group and gives a rough idea of the technological changes that the industry and researchers are expecting over the next five to ten years. So for example Professor Sir Keith O'Nions, Rector of Imperial College kindly prepared a space technology road map last year. That is a basis for everyone to take decisions on where to invest. Some of this may fall to government but business has to make a matching investment in return. That it rests on an agreed plan makes that easier.

This kind of model is being applied right across BIS. As well as in the space sector this sort of activity is also being led in for example the automotive, aerospace, and life sciences sectors. I can announce today that I am setting up further such leadership councils in e-Infrastructure and in synthetic biology. These are not instruments for ministers to impose their will on reluctant sectors. Nor are they devices to increase public spending. We act as conveners bringing together the key players and driving forward investment and innovation. Sometimes the simple fact that such a group exists increases the confidence of a key new sector.

A check list for our high tech strategy.

Now let's finally just review how we are doing in living up to the challenge of these important high tech sectors. We can work through the BNIC list.

Bio is covered by the life sciences strategy which the Prime Minister launched a month ago. It is an ambitious agenda for keeping and strengthening our position in this crucial sector. Our progress is going to be reviewed by two formidable outside experts - Professor Sir John Bell and Chris Brinsmead. But it isn't the final word. I will continue to work with Andrew Lansley and the Treasury on new ideas for the future. So for example we announced a Bio-medical Catalyst Fund with the Medical Research Council and the TSB backing ideas as they traverse the so-called "valley of death" from research lab to commercialisation. There is £180 million of public money in this fund but it could be even bigger if we could entice some corporate venture funds in as well. That is something I want to see.

Bio is not just human health. We have great strengths in biological sciences more widely. After the elimination of Smallpox thirty years ago the UN celebrated the global elimination of a second virus last year. It was rinderpest which affects cattle and other ungulates and blighted agriculture in Africa and elsewhere. British scientists based at the Institute of Animal Health played a key role in this. We have great achievements in crop science too. At the moment we get on average about 9 tonnes of wheat per hectare. The target set by the BBSRC is to get to 20 tonnes per hectare within 20 years. That would be nothing less than a second agricultural revolution and it is essential to feeding the world as wheat provides a fifth of the calories consumed by mankind.

Synthetic biology has been driven by developments in next generation sequencing, DNA synthesis, and systems engineering. It is a potential platform technology with possible applications including bio-energy, industrial biotechnology and chemicals. I have asked leading researchers and business experts in a group chaired by Dr Lionel Clarke of Shell to produce a synthetic biology roadmap to set out the timeframe and actions to establish a world leading synthetic biology industry in the UK. They should report in the Spring after which we intend to convene a new Synthetic Biology Leadership Council to look at how we can deliver that road map.

The very term nano-technology was popularised by Federal agencies in the US. It covers a range of technologies across a range of markets. I have convened the key players to sketch out its future relevance to the UK. It is clear graphene is one very significant example of nano-technology. We are committed to establishing a Graphene Global Research and Technology Hub which will provide access to specialist facilities and expertise. TSB and EPSRC have been working together on this.

Info and cogno cover many things. The rapid growth of Tech City is a classic example of what can be achieved by sustained attention from the very top of Government. Behind it lies our national capacity in high performance computing. We were in danger of losing our position with very few of the world's most powerful 500 computers. Increasingly research today involves handling large data sets - be it from CERN, meteorological data, the Hubble telescope, the sequencing of individual genomes, or indeed just keeping up with the academic literature itself with more than a million academic papers in the life sciences published every year. There is more to computing capacity than raw power: software matters too. So we have invested an extra £165 million to ensure our researchers have access to powerful computers and the software to harness them. We also commissioned Dominic Tildesley of Unilever to report on the significance of e-infrastructure for business. I am releasing his report today. It sets out very clearly practical examples of how business can use high powered computing. Companies like Jaguar Land Rover or Rolls Royce need to be able to model completely the functioning of a motor car or a turbine. The more you can do virtually the more rapidly you can test and introduce new products. That is why they say that to out-compete you must out-compute. We will act on his recommendation of an e-Infrastructure Leadership Council to ensure there are strong links between academic research programmes and business applications.

Then Carbo is low carbon energy. We already have sponsored research on low carbon cars. The TSB's investment in low carbon vehicles in partnership with the EPSRC played a significant role in Nissan's decision to base the production of the entirely electric LEAF model and its advanced batteries in Sunderland. High on our agenda now is nuclear fission and fusion after a challenging report from the Science and Technology Committee of the House of Lords. We will be considering it carefully to ensure we get most advantage from our historic strengths in these sectors.

This is a very quick review but it is clear that the Coalition is committed to a high tech future for our country and is doing everything possible to secure this future source of growth.

Conclusion

Today I have set out 8 steps to high-tech growth:

1. set the Government's goal that we should be the best place in the world to do science;

2. released a series of reports showing what the research sponsored by the Research Councils is achieving;

3. set out our ambition to have more universities in the world's top 100;

4. announced that we have invited proposals for new types of university with a focus on science and technology and on postgraduates;

5. announced our ambition for universities' knowledge exchange funding from external sources to grow by 10% over the next three years;

6. announced that the next Catapult Centre will be in the application of satellite technology;

7. announced that I am setting up leadership councils in e-Infrastructure and in synthetic biology;

8. and released a new report on e-infrastructure strategy.

The critics of our economic policies focus on arguments about a short-term stimulus but what really matters is long term growth. That is what our high tech enterprise strategy is all about. Times like this have persuaded many of us that it is necessary to back the technologies of the future so that we can rebalance our economy. Every Government tries to do it. The only question is whether you recognise it and do it properly or whether you just let it happen as the aggregate of the host of decisions you have to take anyway. This Coalition, faced with the crucial challenge of sustaining growth after the deepest recession since the War, has a strategy for high tech enterprise. We can be proud of it because it is coherent, serious and rests on a commitment to the future of our country and its economic base.

Rt Hon David Willetts MP
4 January 2012

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Another industry award nomination for IFA Life

Wed, 4 Jan 2012 12:54:51 GMT

Every now and again you go through a little 'purple patch' when everything seems to be going in the right direction and your ducks line up nicely in a row.

We finished 2011 with the news that IFA Life has been shortlisted in the 2012 Money Marketing Awards for Best IFA Support Service.

We're up against the big boys - including Sesame Bankhall, SimplyBiz, TenetSelect, threesixty and True Potential. Even to be shortlisted amongst this group is an amazing honour for us.

And now, somehow I've gone and been shortlisted in the 2012 Professional Adviser Awards for Adviser Personality of the Year (won last year by Tina Weeks of Serenity Financial Planning).

It seems this is an award for someone (not necessarily an IFA) who has stood out during the year.

Again, we're absolutely thrilled with this nomination; one which I hope recognises the hard work that everyone who works with IFA Life puts into making it what we hope is a valuable ideas and support hub for IFAs everywhere.

We'll soon be announcing a number of exciting developments on the site - please check back soon.

Oh, and if you're attending the Professional Adviser Awards in London on the 9th February, please do vote for us on the night!

Thank you to everyone who continues to support IFA Life.

Phil

Philip Calvert
Founder of IFA Life

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#IFA gives 5 top tips to boost your finances in the New Year. Please add 5 more

Wed, 21 Dec 2011 11:49:15 GMT

The new years offers the perfect opportunity to review your finances and ensure you are making the most of your money.

Financial Planners Baigrie Davies offer 5 top tips to improve your money for the New Year.

1 - Make an appointment with a financial planner: a financial planner that is certified by the IFP will be able to discuss and review your financial aims and set you on a course to realising your goals.

2 - Consider ethical investments: Christmas is a season of giving so it is a good time to consider socially responsible funds. However, they also have a sound financial basis. As clients sensibly look to ensure they are not over-weight in financials, ethical investing has become an option for investors who want to minimise risk in their portfolio. Clients should ensure they follow all the usual rules such as diversifying their portfolio.

3 - Ensure your pensions are tax-efficient: January is a tax month and pensions can be used to alleviate your tax burden. There is the opportunity to back pay into your pension to catch up with any contributions that have not been maximised over the previous three tax years.

4 - Prepare for Fixed Protection: if you expect your pension savings to be more than £1.5 million when you come to take your benefits on or after 6 April 2012 you can use fixed protection to protect them from the lifetime allowance charge. You can apply for fixed protection until 5 April 2012.

5 - Be wary of investing in tech companies: with Facebook likely to go public in 2012, investors should be careful of jumping on the bandwagon. Although the sale of social media giants make huge sums of money for the folk on Wall Street, good financial planning means we would be very sceptical of investing in a company whose value is based on excessive multiples of their revenue.

Ian Howe, Managing Director of Baigrie Davies said:

"The New Year brings with it plenty of opportunity to reassess your financial goals and make a clear plan for the year ahead. There is a lot of financial change in 2012, particularly in the area of pensions and tax planning. So make sure you speak to a qualified financial planner who can help you make the most of your money."

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Asset allocation and RDR

Tue, 20 Dec 2011 16:44:44 GMT

The new regime that will be in place from 2013 may encourage a review of how the asset allocation model is applied in practice.

IFAs generally allocate and manage their clients’ assets around asset allocation and model portfolios.

One of the key aspects of this has always been – and will remain – where do we put the underlying holdings? The asset allocation basis at the top level is relatively straightforward, producing a split and spread for clients which may look in a typical case something like this: 30% UK Equities, 15% Overseas Equities, 30% Bonds, 10% Property, 15% Cash. The importance of getting this part right is now virtually proven as the most important part of the client’s requirement.

For a client with assets (excluding their own properties) of £1 million this entails chopping their monies into segments and from the split as above £300,000 will need to go into UK Equities. There is good reason in the other areas why funds may be used for the holdings (due to accessibility, liquidity, management of currency etc), but in terms of UK shares, why use a fund? The diversification principle is probably questionable at best, flawed at worst.

What the client needs is a good, strong management of the monies and possibly a tighter control, fewer stocks and more discerned, personalised and bespoke management than most funds produce.

With RDR the bias towards funds may well disappear because, to be frank, one of their key advantages, higher commissions, will be levelled against alternatives such as direct investment.

This is why at SVS we have designed a way for your clients to invest into a controlled and managed share portfolio – with you, as the IFA, retaining control of your client relationship and having a recurring fee income from the share portfolio. No longer will you need to see your client’s direct equity holdings go to another source, if you become a Preferred Partner of SVS (www.svspartners.com) we will provide for you the full service and you will be at the centre of this.

Supporting this will be something very special: we will also provide you with new client opportunities from the substantial investor database that we have built and you can engage with these investors on our behalf developing your own proposition with them as well as representing ours.

This is what the new post-RDR world will look like, IFAs working a new service proposition with new partners – working their permissions together to provide a dynamic outcome for clients, existing and new alike.

To find out more please come to our web site for Partners www.svspartners.com and register your interest and we will send you full details of how we work with IFAs. Remember however that this is an offer that will only ever be extended to a relatively small number of IFAs, so please let us know your interest as soon as possible.

Philip Pooley
Director
SVS Securities Ltd

This is a sponsored article from SVS Securities Ltd

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Irresponsible scaremongering, yet again

Tue, 20 Dec 2011 08:14:07 GMT

I groaned inwardly over breakfast this Sunday when I read the front page headline in the normally excellent Observer.

Yet another story about how fund managers are taking huge fees which are destroying the value of our long term savings. Yet more irresponsible scaremongering by the story's promoters.

Some of the assertions in this particular story were laughable. One claimed, for example, that charges are costing pension funds £67 billion a year; yet the investment management industry's total revenues from all clients was in fact £11 billion in 2010. Another claimed that management fees for pensions are 1.5% a year, as in the retail market, when in fact the average management fee across all business (including pension funds) is just 0.3%.

Most corrosive however is the constant refrain about "hidden charges". The narrative goes like this: the manager will tell you what explicit charges are levied, but there are others on top which you aren't told about, and then of course there is all the money that is creamed off in fees for trading the underlying stocks. The first is easy to deal with: the "other charges" (which go not to the manager, but to the providers of other services, such as the registrar, trustee and auditor) are included in the "total expense ratio" (TER). This is disclosed up front to investors - as is required under European law.

But what about those hidden trading costs? Well, they are not hidden: they have to be disclosed every year in the fund accounts. They represent the cost of investing, just as you or I would face if we invested our money directly. As such, the revenue does not go to the manager, but to brokers which are completely separate from the fund manager. Indeed the latter has a duty to obtain the best deal for the client. Of course, the biggest winner, at least for trades in UK equities, is the Government through its 0.5% stamp duty charge.

But there is an easy way to resolve this argument. Funds publish their prices every day, so it is possible to measure the returns to investors very accurately. If these "hidden charges" really were hitting the investor hard, then you would see it in the average net return. For example, if the TER is 1.75% and the fund underperforms the relevant stock market index by 2.75% a year, then the combined effect of investment decisions and the associated costs is costing investors 1% a year.

Well, we did those calculations a couple of years ago. The results are in this paper. They show no sign of investors losing out from "hidden charges". Indeed, these numbers happened to show that trading had a net positive effect for investors, with the gains resulting from investment decisions comfortably outweighing the associated costs.

I called these stories irresponsible scaremongering. Those are strong words, but justified. It is scaremongering because it puts misleading figures into the public domain. And it is irresponsible because it is telling people they should not be saving for their future, when the responsible advice is that they should.

Richard Saunders
Chief Executive, IMA

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FSA puts common sense at the heart of mortgage lending

Mon, 19 Dec 2011 08:04:00 GMT

The Financial Services Authority (FSA) today announced plans to prevent a return of the risky mortgage lending seen in boom times, by ensuring that common sense standards continue to apply in future.

The Mortgage Market Review aims to prevent a recurrence of the irresponsible lending which resulted in some borrowers taking on mortgages which only seemed affordable on the assumption that house prices would always rise. Many of those borrowers ended up struggling to repay their mortgage and in danger of losing their home.

The proposals will see prospective borrowers - whether they are first time buyers, right-to-buy tenants or home movers - get the right information and advice, at the right time, and ensure mortgage lenders will be properly checking each applicant's realistic ability to repay their mortgage.

The FSA has significantly amended the proposals following detailed feedback from lenders, consumer groups and other stakeholders and informed by a cost benefit analysis which is also published today. The FSA is now encouraging consumers, industry and all other interested parties to give their opinions on this new, full, set of proposals as well as on the accompanying cost benefit analysis.

Following consultation, the FSA Board will make a decision on the final form of rules in summer 2012, but implementation will not be before 2013.

At the core of the proposals are three principles of good mortgage underwriting:

Mortgages and loans should only be advanced where there is a reasonable expectation that the customer can repay without relying on uncertain future house price rises. Lenders should assess affordability;
This affordability assessment should allow for the possibility that interest rates might rise in future: borrowers should not enter contracts which are only affordable on the assumption that low initial interest rates will last forever; and
Interest-only mortgages should be assessed on a repayment basis unless there is a believable strategy for repaying out of capital resources that does not rely on the assumption that house prices will rise.

The FSA believes it is important to have the rules well established long before any future upturns in the economy.

Key features of the proposed future regime include:

Income will have to be verified in every mortgage application;
Lenders do not have to consider in detail what borrowers spend but cannot ignore unavoidable bills, such as heating and council tax;
Interest-only mortgages can still be offered as long as borrowers have a credible plan to repay the capital. But relying on hopes of rising property values is not enough;
Lenders will have to consider the impact of increases in interest rates in line with current market expectations;
Some applicants, such as those trying to consolidate debts with a mortgage, will have to get advice to ensure they understand the full implications and costs; and
Existing borrowers will be unaffected and lenders will have the flexibility to provide new mortgages to some existing customers even where they do not meet the new affordability requirements.

The FSA is also calling for feedback on developing a specific approach for entrepreneurs who borrow against their home to fund their business.

Lord Turner, chairman of the FSA, said:

"We believe that these are common sense proposals which serve the interests of both lenders and borrowers. While the excesses of the pre-crisis period have largely disappeared from the current market, it is important to ensure that better practice endures in future when memories of the crisis recede and the dangers of poor practice return.

"The three key proposals are, we believe, the most effective way to tackle the problem of risky lending. But it is essential that we understand what their impact would be - how many consumers would be protected from the distress of arrears and repossessions, and, how many consumers who could have afforded a mortgage might have to take out a smaller mortgage or to delay their purchase.

"The estimates are inherently uncertain, but they suggest that that the new rules would have only a marginal effect in current market conditions - and particularly so for first time buyers - but would act as a significant constraint if market practice were in danger of returning to the 2005 to 2007 pattern. That pattern of effect would be a highly desirable one. We are however particularly keen that lenders provide their detailed assessment of the likely impact of these proposed rules. Then the FSA will be able to make appropriate final decisions.

"The proposals published today reflect the ideas and input of many stakeholders, including consumer groups and lenders. We believe these proposals will hardwire common sense standards into mortgage lending and guard against the risky lending practices of the past - leaving most borrowers unaffected, but better protected."

The consultation is open until March 30 2012.

Summary of proposals

Responsible Lending & Interest only

The affordability assessment

A lender must verify income and be able to demonstrate that the mortgage is affordable taking into account that figure for income and, as a minimum, the borrower's committed expenditure (which includes the mortgage payments) and essential household expenditure.

The interest rate stress test

The lender must also take account of the impact on mortgage payments of market expectations of future interest rate increases.

The interest-only proposals

The lender must also assess affordability on a capital and interest basis, unless there is a clearly understood and believable alternative source of capital repayment.

Repayment strategies

A lender may not accept speculative repayment strategies, such as reliance on increased property prices.

Lending beyond state pension age

The lender should adopt a prudent and proportionate approach to assessing income where the mortgage term extends beyond the state pension age of the applicant.

Debt consolidation for credit impaired consumers

For credit impaired consumers who are consolidating debts the lender will be required to either assume that the debts will remain outstanding by including them as ‘committed expenditure' or repay the debts directly to the creditor.

Transitional arrangements

We will allow lenders to waive the affordability rules when entering a new mortgage contract - providing the borrower has a good repayment history. These arrangements do not compel the lender to lend, ultimately that is a commercial decision for the firm.

Distribution and Disclosure

Affordability

We have removed the requirement for intermediaries to assess affordability. Intermediaries will only be required to determine whether the consumer meets the lender's expected eligibility criteria.

Advice

We are removing the non-advised sales process and requiring all sales which involve spoken or other interactive dialogue with the consumer to be advised.

Execution only

Knowledgeable consumers such as High Net Worth individuals and professional consumers can opt-out of receiving advice and purchase on an execution-only basis.

Vulnerable consumers

Vulnerable consumers (i.e. equity release, sale and rent back, right to buy and those who are consolidating debt) will not be allowed to opt-out of advice. However, with the exception of sale and rent back consumers, they can reject the advice and proceed to purchase on execution-only basis.

Non-interactive sales

With the exception of those we have categorised as vulnerable, where there is no spoken or other interactive dialogue in the sale (e.g. purely online and postal sales) consumers will be able to purchase on an execution-only basis.

Consumer information

We have reduced our prescribed disclosure requirement for firms in order to reduce information overload for consumers. Instead we have re-focused our requirements so that key messages are brought to the consumer's attention at the right time and in a way that they are most likely to be receptive to.

Direct only deals (deals only available to the consumer if they go directly to the lender)

We are making it easier for intermediaries to recommend a direct only deal by removing the requirement to provide a Key Facts Illustration (KFI) for those deals.

Arrears and Repossessions

Arrears charges

We have strengthened our existing rules on arrears charges to address areas of poor practice and significant abuses found in arrears handling practices, for example changing guidance in rules on administration costs, or limiting the number of payments lenders can collect to two direct debits a month.

Non deposit taking lenders (Non-banks)

Prudential requirements

We are introducing capital requirements to reflect the risks in non-bank lending. This includes requiring:

non-bank lenders adopt a more risk-based regime;
the quality of capital is increased; and
firms to put in place systems and controls to manage their liquidity risk effectively.

Niche Markets

The niche sectors of the market consists of equity release (lifetime mortgages and home reversion plans), home purchase plans, sale and rent back, bridging finance, high net worth lending and business lending.

The FSA wants to achieve the same broad outcomes for niche consumers as for conventional mortgage consumers so is proposing a straight ‘read across' of the majority of its proposals, affordability checks, income verification, etc...

Summary of AMENDS SINCE PREVIOUS CONSULTATIONS

Proposals unchanged since previous consultations

Responsible lending

Lender responsible for affordability checks
Income to be verified in all cases
Expenditure to be assessed in all cases
Stress testing against future interest rate increases

Distribution and disclosure

Removing requirement on intermediaries to assess affordability
Requiring every seller to hold a relevant mortgage qualification
Replacing the Initial Disclosure Document (IDD) with a requirement for firms to disclose ‘key messages' to the consumer
Changing the ‘trigger points' for presentation of the KFI to reduce information overload for consumers
Removing the requirement for ‘independent' firms to offer their customers a ‘fee only' option
Requiring ‘independent' firms to disclose to their customer whether they are sourcing direct-only deals
Requiring firms to consider appropriateness of rolling fees into a loan
Requiring consumers to positively elect to roll fees into the loan

Arrears charging practices

Limiting the number of times fees for missed payments can be charged
Widening the arrears charges and forbearance rules to cover all payment shortfalls
Clarifying what costs can and cannot be recovered through arrears charges

Proposals amended since previous consultations

Responsible lending

Details of expenditure assessments
Details of stress test against possible increases in interest rates
Assessing affordability assuming capital and repayment basis in all cases - now will allow interest-only as long as there is a credible repayment strategy as per interest-only policy

Distribution & Disclosure

Requiring sellers to assess appropriateness across all sales - now requiring advice to be given whenever there is spoken or other interaction
Explanation of scope of service - now must inform the consumer of any limitations to their service
Requiring sellers to assess if appropriate for consumer to take further advance rather than remortgage - now just need to inform consumer that a further advance may be available

Proposals consulted on and not proceeding with

Responsible Lending

Assessing affordability over a maximum 25 year term
Requiring firms to apply an affordability buffer for credit-impaired consumers

Distribution & Disclosure

Replacing scope of service labels with the RDR approach of ‘independent' and ‘restricted'
Requiring firms to provide two KFIs where the borrower is considering rolling fees into the loan
Requiring sellers to assess if appropriate for the loan to extend into retirement

Proposals not yet consulted on

Interest-only
Arrears - removal of rule that permits removal of concessionary rates if consumer has a payment shortfall
Prudential regime for non-banks
Read across to niche markets
Transitional arrangements

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Ten fund predictions for 2012. Do you agree with them?

Fri, 16 Dec 2011 10:40:22 GMT

Tom Biggar, Head of Investments at TQ Invest said:

"There is a strong view that we will have another sideways moving market in 2012 with continued volatility similar to that seen this year. Despite all this there are spotlight funds which stand out as having the potential to beat the market next year and could be worth investors considering.

The New Year is the obvious time to review investment holdings and reposition portfolios, each of these funds offers the potential for long term growth and income prospects.

Dull, defensive and boring appears to be the new vogue for investors and I believe we will need more of the same attitude next year. Funds that control their risk and show an emphasis to preserving capital on the downside will remain popular. There is a growing demand for income and in a year where capital growth forecasts are pessimistic, total returns from income and growth are the order of the day."

The value of investments and the income from them can go down as well as up. Past performance should not be regarded as a guide to the future. The investments described may not be suitable for all recipients and this content does not constitute personalised investment advice.

TQ Invest's ten fund predictions:

Strategic Bond sector - M&G Optimal Income - Richard Woolnough is a veteran manager who is capable of steering his fund through difficult market conditions. His fund tends to outperform peers in down markets. Recent good investment calls has ensured the fund remains firmly in the top quartile and the fund is currently positioned conservatively due to its backing of strong corporate and high yield bonds as well as government bonds that have been held during the Eurozone crisis. A current yield of 5.1% means this is an attractive pick for the income investor.

Global Bond sector - Old Mutual Global Strategic Bond - Stewart Cowley is another veteran of the fixed interest world. He has increased his holdings in corporate debt recently however he remains negative in his outlook for Europe and the US and remains positioned for further tightening. Above average performance in every one of the last 5 years and very strong performance over the last 6 months during the Eurozone crisis suggests that if you think the situation will get worse before it gets better, then this could be the fund for you.

UK All Companies sector - JOHCM UK Opportunities - A manager with over 10 years investment management experience, John Wood believes the potential of equities is much more attractive than that of heavily indebted government bonds. He tends not to get sucked in by the latest investment fads but rather focuses on companies that generate large amounts of cash that can withstand the test of time. He is a manager to back in times of uncertainty but tends to fall behind the pack a little when growth is strong.

UK Equity Income sector - Invesco Perpetual High Income - There can only be one obvious choice in the current market conditions and that is Neil Woodford. The investment legend has won many plaudits with his low turnover portfolio (his average stock holding is 10 years) and he is one of the last bastions of true long term investing. No 1 in his sector this year, he is someone to turn to when conditions get tough but is another that can lag behind in strong bull markets. That said this is the fund to hold for 10 years plus. He's a consistent performer who produces a competitive yield (currently 3.9%).

European sector - Neptune European Opportunities - Rising star Rob Burnett is not afraid to make big changes to his fund in line with his changing view on the macro economy. He made a big move into financials at the beginning of the year but a sharp about turn was made a few weeks later and he continues to remain defensive. Perhaps the most unpopular equity sector at the moment could produce the most opportunities next year? Above average performance in each of the last 5 years and a tight risk control makes this fund one of the top pick's in its sector.

North American sector - Threadneedle American Select - Cormac Weldon has run the fund for 10 years and has produced above average performance in 3 of the last 5 years. Another sector that is relatively unloved, north american equities are in reassuringly good shape despite the macro economic backdrop. The fund is supported by a large team and follows strict risk controls when picking stocks using its top down thematic framework, which gives it good grounding for strong future performance.

Global sector - Newton Global Higher Income - James Harries manages the fund and has consistently outperformed his peers since launch. His ability to limit the downside on the portfolio has ensured top quartile performance in difficult years. The yield on the fund is currently 5.0% and this demonstrates the defensive characteristics within the portfolio. The growing popularity for investors seeking income away from the traditional income haven of the UK has seen this fund swell to over £2bn in size.

Asia Pacific sector - Newton Asian Income - Jason Pidcock manages another fund from the Newton stable which are proving to be real thoroughbreds when it comes to global, equity and income. This fund has produced above average performance in 4 of the last 5 calendar years and currently yields 5.6%. Another feature of its defensive characteristics is its low volatility compared to its sector counterparts. With volatility forecast to remain high in Asia Pacific markets, this fund is a worthy consideration for income and growth investors.

Emerging Markets sector - First State Global Emerging Markets Leaders - The manager, Jonathan Asante, looks to avoid hiccups by not investing in state run firms which are less transparent but prefers companies run by people with a strong history of aligning themselves with share holder interests. His cautious approach sees strong protection on the downside and has resulted in top quartile performance over each of the last two years. If you want to invest in a more cautious Emerging Markets fund then this fund offers the right credentials.

Multi Manager sector - Cazenove Multi Manager Diversity - Marcus Brookes and Robin McDonald have done a great job at controlling the volatility of the fund and have produced top quartile performance this year. Their highly researched process benefits from a combination of asset allocation and fund selection expertise which offers diversification and access to the best specialist fund managers. It combines growth, value and business cycle management styles and the team have produced an enviable and respected track record that positions them strongly for next year.

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UK consumers are a nation of online shoppers. Are IFAs taking notice of the trends?

Thu, 15 Dec 2011 07:30:35 GMT

More consumers in the UK use the internet for shopping than other major countries, a new Ofcom report reveals. They also watch more TV online, use their mobiles more to go online and play more games on their phones.

The report also reveals that the UK customers are paying lower prices for their communications than many consumers across the world.

Ofcom's sixth International Communications Market report into the global communications market looks at take-up, availability and use of broadband, landlines, mobiles, TV and radio in 17 countries.

It shows that despite the economic downturn, global communications revenues grew by 3.4 per cent in 2010 compared with 2009, mainly driven by strong growth in the BRIC countries (Brazil, India, Russia and China).

A nation of online shoppers

The report found that eight in ten UK internet users (79 per cent) said they had ordered goods or services online in 2010, higher than any other European country, with just 27 per cent of consumers in Italy claiming to have done so. UK internet users were also more likely to visit retail websites online than other countries, with nine in ten (89 per cent) claiming to do so in 2011.

As well as more UK consumers shopping online, they also spent more time on retail sites - an average of 84 minutes in January 2011, compared with around 20 minutes for consumers in Poland and Italy.

Smartphone take-up driving mobile internet access

Smartphone ownership nearly doubled in the UK between February 2010 and August 2011 (from 24 per cent to 46 per cent) and take-up was higher in the UK than among the other European countries surveyed (France: 35 per cent, Germany: 32 per cent, Italy: 40 per cent and Spain: 45 per cent).

The number of people using their mobiles to go online was also higher in the UK with nearly half (46 per cent) of UK internet users using their phones to go online in October 2011. This was higher than in all the other countries surveyed.

UK consumers were also more likely to play games on their phone (34 per cent compared with 16 per cent in France).

A quarter (25 per cent) of UK mobile users accessed news content on their mobiles, significantly higher than in other European countries. This could be partly due to higher smartphone take-up and UK newspaper websites having mobile specific websites.

They were less likely, however, to use the internet to make phone calls than in other countries. Just under a fifth (19 per cent) of UK broadband subscribers used services such as Skype to make internet phone calls, compared with 28 per cent in Italy and 26 per cent in France.

TV viewing extends online

The UK's love of TV continues, with over a quarter (27 per cent) of UK internet users saying they watched TV online every week, an increase of 3 percentage points from 2010, and higher than any of the other countries surveyed. The popularity of a wide variety of free-to-view catch-up TV services such as BBC iPlayer has helped to drive online TV viewing in the UK.

The UK also saw the largest growth in digital video recorder (DVR) take-up, with over a third (36 per cent) of homes now owning a DVR (a 4 percentage point increase on 2009). Among the six countries surveyed, the UK is second only to the US, where 41 per cent of households own a DVR.

Overall, TV viewing in the UK increased by 7.6 per cent in 2010 compared with 2009, with the average person watching just over 4 hours of TV per day (242 minutes). This was the highest increase year-on-year among the countries surveyed, and 31 minutes more than the average of 211 minutes per person.

Social networking in wide use around the world

Social networking is a global phenomenon, with over three quarters of consumers in the markets we surveyed saying that they have visited a social networking site, with the majority saying they visit them on a daily basis. This is much higher among 18-24 year olds, with eight in ten (83 per cent) visiting on a daily basis.

Social networking sites are most popular in Italy, with 91 per cent ever having visited and a quarter visiting over five times a day (24 per cent), while in the UK eight out of ten (79 per cent) have ever visited with one in five visiting over five times a day

UK consumers are more likely to access social networking sites on a mobile phone than other countries, with 43 per cent of those with social networking site profiles saying they do so compared to just 30 per cent in the US. However UK social networkers say they have fewer friends online (168) than Americans (198) or Italians (216) - but more than the French (108) or Germans (137).

Consumers are also using social networking sites for breaking news, with one third (35 per cent) of UK consumers saying they do this and nearly half of French (45 per cent) and Italians (47 per cent) agreeing. Breaking news is more popular among 18-24 year olds in all countries.

Consumers getting a good deal in the UK

Ofcom research into the prices consumers pay for their communications services has found that prices in the UK compare favourably to those available in other countries.

The analysis examined the prices of a typical ‘basket' of communications services (fixed-line phone, mobile phone, broadband and pay TV) for five household types. It compared the prices available to consumers in the UK (in July 2011) with those in France, Germany, Italy, Spain and the US. Overall, the UK offered the lowest prices for all five baskets based on buying services individually and four of the five baskets when including multi-service ‘bundles'.

Overall, the price of mobile phone services in the UK were 36 per cent lower than in the next least expensive country (France) and were 10 per cent lower than a year previously. However, prices for low-use mobile phone services (such as pay as you go) in the UK increased between July 2010 and July 2011 (as they did in France, Germany and Italy). Fixed-line voice prices in the UK were also lower than in all other countries.

Looking at the prices for a typical family ‘basket' of communications services consisting of a fixed-line phone with high use, four mobile phones with varying use, a fixed broadband connection and a basic pay TV subscription, the lowest price available to consumers in the UK was £114, second only to France (£79). Prices for this basket in the UK increased by 10 per cent between 2010 and 2011, largely due to increases in the prices of the low-use mobile phone services.

Superfast broadband rapidly becoming available

Overall availability of high-speed fixed-line broadband networks in the UK compares favourably to other European countries. By June 2011, 59 per cent of households had access to Virgin Media or BT's superfast services. However, just 4 per cent of UK households subscribed to superfast services in June 2011, compared with 40 per cent in Japan and 10 per cent in the US, although higher than in Germany (3 per cent), Italy (1.5 per cent) and Spain (2.2 per cent).

New spectrum that will be used for superfast mobile broadband networks using LTE technology has been auctioned in a number of countries. Some countries, such as Sweden, have already launched networks, with headline speeds of up to 100Mbit/s. Services in the UK are expected to launch in 2013 following the 4G spectrum auction in the second half of 2012.

Internet use drives high online advertising spend

More and more advertisers are flocking to the internet across the globe, with the UK leading on the total proportion of advertising spent on the internet (29 per cent) - almost double the level for global internet advertising (15 per cent). UK online advertising spend in 2010 was almost the same as TV advertising (30 per cent), increasing by 16 per cent to reach £4.1bn.

Increased global communications revenues

Communications revenues increased across the board in the 17 countries covered in the report compared with 2009:

Total retail telecoms revenues generated £594bn in 2010, 1.9 per cent higher than in 2009;
Total radio revenues reached £25bn in 2010, up by 5 per cent from 2009; and
TV revenues increased by 7.7 per cent year on year from £222bn to £239bn.

Ofcom Chief Executive Ed Richards said:

"Across the globe people are embracing e-commerce and social media with enthusiasm. Our research shows that the UK communications market is performing well with prices, the range of services and innovation standing up well against international benchmarks.

"There are also issues which we will monitor carefully, such as the future roll-out 4G mobile services. We are pressing ahead with plans to release this valuable spectrum at the end of next year which will enable new mobile services for consumers."

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Why every IFA firm needs a mobile website

Fri, 9 Dec 2011 10:11:51 GMT

Earlier this week we launched our new mobile website.

This was an important event for us, as mobile devices are increasingly becoming the browser of choice for accessing the Internet.

Depending on which stats you look at, between 7% and 15% of all Internet traffic is originating from mobile devices. This share of the market is growing rapidly, as Internet users prefer to browse for content on their mobile phones.

Year to date, a little over 20% of our new clients have come to us as a result of our website and activity online, including our use of Social Media. Our website forms the hub of this activity, with regularly updated blog content stimulating debate and encouraging repeat visitors.

Because our website visitors increasingly choose to visit our website using a smartphone (iPhone, BlackBerry, Android, etc), we needed to ensure that this was a good experience. If you have ever tried to browse a desktop website in a mobile phone browser, you will know how frustrating this can be. Simply trying to click on the correct link requires a degree of manual dexterity very few possess.

Making the decision to ‘go mobile’ with your website requires an important decision.

You can either develop an application (‘app’) for each brand of smartphone or create a mobile website that is compatible across the full spectrum of smartphone operating systems.

Apps are probably seen as the trendier option. Once developed, they are typically downloaded by the smartphone user from their ‘app store’. They can either be downloaded free of charge, or a nominal fee can be charged to the user for the download.

There are two main problems with going down the ‘app’ route.

Firstly, you need to develop a different app for each main smartphone operating system. This means developing one app for Apple, another for BlackBerry and another for Android. Even going to this expense fails to cover the entire smartphone market.

The second, and potentially biggest problem with developing a mobile app, is that it requires users to download and activate the app on a proactive basis.

You may encourage people to download the app and use it once, but unless there is a compelling reason to visit again on a regular basis, the app and its icon is likely to sit unused on their screen until they get round to deleting it to take space for the next big thing.

Developing a mobile edition of your existing website therefore makes a lot of sense.

One mobile website will work across every smartphone device. Users can still add an icon to their smartphone, to get direct access to the website for repeat visits. Ordinary website traffic from a smartphone browser is automatically detected and directed to the mobile edition of your website, for a better browsing experience.

There are some other compelling reasons why developing a mobile website makes a lot of sense for IFAs.

Having a mobile edition of your website helps with search engine optimisation. Google (and others) recognise that the website is specifically designed for mobile devices, so prioritise it in local search results. This means that anyone searching for an IFA or Financial Planner locally will see our mobile website returned as a top result.

One of our favourite features for our new mobile website is the SMS marketing capability.

By sending the word informed as a text message to 84840, users automatically receive a text message back from the system, with details of their nearest Informed Choice Financial Planner.

This text message reply contains the phone number and email address of the Financial Planner, along with a link to their profile on the mobile website.

This functionality uses the GPS module in the smartphone, which reports the general location of the smartphone user when they send the text message, along with an online mapping system to locate the closest IFA in geographical terms.

At the end of each day, we get an email report listing the details of the prospective customers who have used this system.

To date, this system has been used with great success by estate agents and property developers, to provide customers with the details of their nearest available properties. We saw this in use and identified an opportunity to apply it within the IFA market.

Mobile websites can also be combined with QR codes.

QR (quick response) codes are a bit like barcodes for smartphones. This QR code (http://www.brilliantwithadvice.co.uk/wp-content/uploads/2011/12/Picture1-300x300.gif), for example, when scanned by a free smartphone app, takes users directly to our mobile website.

We have plans to add a QR code to our business cards in the future, so people can add our contact details directly to their mobile phones, including a link to the profile of the IFA on our mobile website.

Having a bespoke mobile website and combining it with these innovative marketing tools is rapidly becoming a necessity for professional firms.

Missing out on 7-15% (and growing) of available Internet traffic will prove to be very expensive, particularly when these prospective customers are likely to be affluent, action-oriented smartphone users.

You can visit our new mobile website by pointing your smartphone browser to m.icl-ifa.co.uk. Alternatively, text the word informed to 84840 to try out the system and find your nearest Informed Choice Financial Planner.

Our thanks go to the team at Intelligent Mobile for developing the new mobile website and our website developer Gareth Thompson at [code:potato] for the original design.

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IFAs - Register for your chance to win a box of Gold Standard wine

Fri, 9 Dec 2011 09:04:58 GMT

Win a fabulous box of mixed or single colour Gold Standard wine from Laithwaites to enjoy over the festive period or to celebrate with colleagues in a well deserved toast. All you have to do is register with Worldwise Investor, it only takes two ticks.

Registered users of the site will get:

To search a full fund library that filters by geography, theme, asset class & ethical screen
News that makes a connection to funds and puts them in context
Email alerts about how favourite funds are performing
To view benchmarks that show how funds are performing against their peers
To bookmark favourite funds and themes in ‘myworldwise’
Get the latest expert opinion by subscribing to our blog

The compeition will run from 6 - 20 December.

First 300 registrants will be put into a hat and the winner drawn on 20 December.

The winner must be a UK resident.

The winner can select a mixed or single colour box of wine.

Registrants must be an IFA, on the FSA Register to be eligible for the draw.

About Worldwise Investor

Worldwise Investor is a free resource to UK investors and advisers, providing a single point of reference for investment performance, news, thought leadership and discussion on investment funds within the environmental and thematic investment fund industry.

The site has been designed by Holden & Partners in partnership with 6 key Investment Houses and key Independent financial advisers to help investors in making educated decisions about their investment funds.

The aim of the site is to enable Investment Fund Managers and their investors to communicate in a timely manner in a format which is controlled by and easy for investors and advisers to pick up.

This is facilitated by the Partners of the site being able to input news directly onto the site, without editorial input, and for investors, through myWorldwise, to select which funds and themes they are interested in and thus wish to follow. In this way investors and advisers do not need to log on and register on numerous sites to keep up to date and monitor their investment funds.

Thematic investing is becoming increasingly important to the investment industry and investors, as mega trends in consumer behaviour become identifiable and investable. Thematic investing includes but is not limited to older terms, which many investors will have heard of, such as environmental investing, sustainable investing, ethical and green investing.

This increased awareness and interest in thematic investing is fuelling a need for a greater breadth and depth of information and more straightforward and transparent access to key facts (see our fundview on each investment fund) and figures, which we hope Worldwise Investor is able to fill.

[Sponsored article from Worldwise Investor]

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