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New report seeks to spur on advisor uptake of debt-based securities




By Ryan Weeks on 18th September 2017


Intelligent Partnership makes case for debt-based securities with new CPD-accredited report.

 

That financial advisors have been slow to adopt alternative finance investments is widely acknowledged. Debt-based securities, of the kind offered by Downing Crowd and Goji, are just one of the sector niches they’ve been wary of.

 

But a new report from IFA-focused research group Intelligent Partnership seeks to change that. The Debt Based Securities Investment Sector Report highlights the range of available investment opportunities, and the role they can play in a diversified portfolio.

 

“This report addresses the issues head on to dispel the myths and address advisors’ reservations about debt-based securities,” said Julia Groves (pictured), partner and head of crowdfunding at Downing. “Contrary to widely-held beliefs, these products needn’t be complex, provide due diligence, they are not necessarily high risk, and can offer portfolio diversification.”

 

The debt-based securities proposition was sweetened in 2016 when the investments were made eligible to be held within an Innovative Finance ISA (IFISA). The IFISA is most commonly associated with peer-to-peer lending investments, with bond-based platforms like Triple Point sometimes overlooked.

 

But the Intelligent Partnership report argues that it is important to make plain the distinctions between P2P and debt-securities investments to help advisors understand the characteristics of each asset class, and the role the latter can play in client portfolios.

 

“Following the Retail Distribution Review (RDR), advisers need to be aware of all the possible investment options that could be suitable for each of their clients, and be in a position to recommend them when merited,” said Intelligent Partnership managing director Guy Tolhurst.

 

“This report aims to give IFAs and paraplanners the confidence and knowledge they need to assess opportunities in the debt based securities area and allow their clients to take full advantage of the various offerings to access yield or diversify portfolios.”

 

The report may be downloaded here.

 

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