Colonial First State executive officer Brian Bissaker sang the praises of advisers at the recent Investment and Financial Services Association (IFSA) conference.
Speaking on a panel with AustralianSuper head Ian Silk, Bissaker defended the position of advisers, saying the unsung value of advisers was they were advocates of clients in super funds.
Not only is their focus on the clients not well understood, he said, but advisers were at the coalface interacting with super funds on a daily basis.
They know more than anyone else about the service provided by these funds by virtue of dealing with them regularly.
They know if the funds are providing good service levels and levels of comfort for the clients through their interaction. Through transactions they find out details of compliance and trails as well as the regulations in the industry.
However, Bissaker said advice was costly and there was a need to get costs down. There is subsidisation, which is good, but with that there is potential for conflict.
Bissaker also went on to say that while there was plenty of information accessible to investors, there was a great need for advice.
Even Morningstar tables, which are readily available in weekend newspapers, could be misleading, Bissaker said.
Unless investors are familiar with issues, such as asset allocation and liquidity, just watching the relative performance of the funds could be misleading and people need advice to understand them.
Aggregation was another issue Bissaker felt was misleading to investors. When you aggregated and averaged performances and fees, it often gave a picture that was a long way from where consumers were, he said.
It’s not often advisers hear praise, so I thought it best to pass this on.
