Cofunds top choice with IFAs

Cofunds is the top choice amongst IFAs despite a stormy year for the platform provider, according to a new study from CWC Research.

Research in association with BNP Paribas, which surveyed over 100 individuals at 70 IFA firms, found Cofunds was the top choice if they could only select one platform in the market.

The results show IFAs appear to have been unaffected by the backlash from fund management groups against Cofunds following its renegotiations on terms.

"Cofunds are winning big deals and also attract small firms," says Clive Waller of CWC Research.

Standard Life, winning support from medium-sized firms, moves into second place.

But in terms of the highest-rated platform amongst IFAs' existing providers, Cofunds falls to second place behind Transact which continues to come out on top. IFAs gave Transact a rating of 4.2 out of 5.

"They continue to delight their users," says the study.

Cofunds and Standard Life are in joint second place with a score of 3.8. Of the smaller platforms, Ascentric and Nucleus scored 4.8 and 4.5 respectively on samples too small to be included in the overall comparisons.

On the subject of platform selection criteria, more than half of the sample think scope and functionality are most important, followed by ease of administration and financial strength.

The findings highlight the overwhelming importance IFAs attach to platforms in the run up to the RDR, with a huge 95% saying they employ platforms. Additionally, 75% of IFAs "appropriate business" comes via platforms.

Its research also brings to light a clear preference for single platforms, with 80% of adviser firms preferring them to multiple models. However, few IFAs actually think they will achieve the single model goal.

CWC says those with a discretionary or multi-manager investment strategy and a strictly passive approach to using funds have the best chance of achieving single model status.

Despite the upbeat picture painted of the platform landscape, Waller says the issue of switching platforms needs to be addressed and calls on the OFT to take action.

"The inability to change platforms quickly and easily is anti-competitive and makes the FSA's due diligence requirement ineffective," he says. "There is a clear customer detriment."

Summing up, he thinks platforms and technology will play an ever-more important role because they make adviser charging simple, aid the development of model portfolios and offer professional reporting and analytical tools.

"Platforms plus expert systems and tools will be key," he concludes.

CWC conducted interviews with over 100 individuals at 70 IFA firms and ten board level employees or divisional managers of nationals and networks.