Tech Review: Ascentric

Mark Loosmore of AT8 starts the New Year with a review of Ascentric.

Ascentric claim to have been the first online funds supermarket in 1999, but its heritage goes back further to the 1980s as an offline discount brokerage. Its history includes operating as part of Egg as FundsDirect and later independently as FundsDirect. In early 2007, it launched its wrap platform that is well known in the market today, although its direct-to-consumer fund service is still operational.

In December 2007, Royal London took a majority stake in Ascentric. Interestingly, Ascentric has always marketed its independence as a significant differentiator, and it has strived to keep a distance between its owner and the running of the wrap.

The branding is very distinctive, unlike other provider-owned platforms such as AXA, Standard Life and Skandia. Indeed, you will struggle to find any mention of Royal London on its website or in any of its marketing material. Royal London funds are, of course, listed on the platform, but I am assured that there is no bias towards selection of these funds in how the solution operates.

There are a number of benefits to being owned by a product provider, which include access to capital and assistance to meet the increasingly stringent FSA capital adequacy requirements.

Ascentric is smaller than some of the platforms which we have reviewed to date, but still claims Assets Under Administration (AUA) in the region of £2.4bn. It has 2,600 funds available on its platform from 260 different fund managers. It covers a wide range of asset types including:

• stocks and shares
  
• hedge funds
  
• SICAVs
  
• cash accounts
  
• offshore bonds
  
• onshore bonds
  
• SASS
  
• ETFs
  
• institutional funds
  
• wide range of SIPPs.
  

Ascentric is adding a Cash ISA in 2011 and a Group SIPP is due to be introduced in 2012.

At the time of writing, the Ascentric Wrap is still loss making but this position is forecast to change as early as Q2 this year.

Ascentric’s positioning is strongly aimed at being unbiased and unrestricted – it sells heavily on its open and honest culture and is proud of its focus on the adviser rather than the direct market.

New pricing structure

At the start of 2011, Ascentric launched a new pricing structure. It had clearly recognised that it was uncompetitive for portfolios that were under £60,000 and for those over £3,000,000.

Ascentric’s charging now comprises:

• £60 + 0.15% charge for funds up to £60K (previously 0.25%)
  
• 0.25% Platform charge on balance of funds between £60k and £1m
  
• 0.10% charge on balance of funds between £1m and £3m
  
• Discounts are available on the balance of funds greater than £3m.
  

The new charges were made available to Ascentric users from Tuesday, 4 January 2011 and have removed the £150 per annum minimum charge on port­folios of less than £60k. The minimum investment amount has also been reduced from £5,000 to £1,000.

The move is clearly aimed at attracting those that are aiming for a single platform strategy or a core platform with a few niche additions. AT8 recognises the market demand but remains cautious about advisers choosing a single platform, unless the advice firm has a very clear and consistent client segment profile and niched service proposition.

Ascentric covers many of the features that you would expect from a wrap, ranging from fund analysis, assessing risk, managing model portfolios to executing transactions and reporting. One new area which we particularly liked was the recent addition of the Fund Research Centre from FundsLibrary.

We have mentioned Fund Research Centre several times, both in the pre-Christmas review of Hargreaves Lansdown and in the review of Cofunds. However, Ascentric appears to have extended the functionality further still.

Ascentric’s implementation of Fund Research Centre has the normal access to interactive fund factsheets and performance charts but it has added a key features builder that incorporates the adviser and platform charges and gives a clear view of the costs and charges involved for the client.

The extra feature sees Ascentric ‘walking its talk’ about transparency ahead of RDR and is to be commended. It has also added a portfolio builder function, allowing advisers to create and compare sample port­folios presale for benchmarking, tracking and future comparisons.

Our only disappointment is that when moving to the Fund Research Centre from the main platform solution once again, there is a change in the look, feel and navigation controls. Although not important to everyone, it breaks the impression of a seamless process for both the client and the adviser.

Overall, we remain impres­sed with Ascentric. It is feature-rich with access to a wide number of funds. It has recognised where it needs to adjust its pricing and as of this month, is more competitive at both the top and bottom of the portfolio range, and that should help it as it strives to move into profitability in the early part of 2011.