Wealth manager Sterling McCall moves to discretionary model

Wealth manager Sterling McCall has moved its investment offering to a discretionary fund management service.

The Loughborough-based firm will hand over an initial £30m to Newscape Capital Group to run in three bespoke portfolios.

A desire for transparency among clients as a result of the financial crisis is a major factor behind the move away from the traditional fund supermarket and provider platform approach, the firm explains.

"Financial advisers are not fund pickers or investment managers," says Steve Moseley, a director at Sterling McCall.

He adds: "They have neither the time nor the tools to assess investment decisions.

"Discretionary fund management offers us the certainty that we retain our client relationships, while ensuring that their investments are being optimally managed."

The portfolios will be run on risk lines:

• The Low-Risk Portfolio will aim to deliver returns of cash plus 3% over five years with minimal volatility.
• The Tactical Portfolio is designed for investors looking for a more active approach to asset allocation, and will aim to outperform cash by 5% per year.
• The Growth Portfolio will have an aggressive strategy, investing in a diverse range of investments, including commodities, emerging markets and boutique holdings. It will aim to deliver returns in excess of global equity markets over the medium-to-long term.

The move comes weeks after the firm signed up to Praemium's discretionary management platform, which will provide the technology for the Newscape funds.

Sterling McCall aims for Newscape to be managing up to £250m within five years.