Barclays have just produced their post RDR fee card for "managing" (if that's what banks do) peoples' investments.
For clients using its advisory investment service, the bank will now charge an annual fee of 0.75% for advice and custody on the first £1 million in assets, which then drops to 0.6% for the next £2 million, 0.5% on the next £4 million and 0.25% over £7 million.A local stockbroker's (me, for example) dealing commissions will be smaller for deals over around £10,000 too. Online execution-only brokers smaller still. A local stockbroker can offer One phone number, one point of contact, no bri-nylon school-leavers selling from a script which pops up on the screen when you call. Reviews can be conducted in a pub over a pie and a pint, club in London, or by e-mail and post.
When a stockbroker's clients call, you are talking to the decision-maker, not a salesman, unlike a bank, whose "investment managers" use a top-down investment process. This grand-sounding magic is the method by which a committee sets the weightings in asset-classes, then another committee chooses which assets in each class should go into portfolios, then your investment manager is presented with a list and told to go and sell the trade-du-jour to his clients. It looks like science, but I won't work for any institution which insists on it. Analysts are remunerated for justifying trades, and "managers" are remunerated on successfully selling trades to clients.
How do I know this? I once watched a perfectly healthy stockbroker destroy itself by imposing an investment process.
Unlike a bank, I have worked out the easiest way to generate outperformance is to deal less often. If the market falls.Unlike a bank, I don't have a big legal department making take-the-piss charging for half-arsed portfolio advice (stick it in multi-manager fee-larded shit and forget about it till commission-time) compliant with the regulations. Because as we all know, regulations benefit the big business at the expense of the small.
And the effect of the regulations on customers? Well, you can see fees going up. Regulation isn't free.
I own shares in Barclays, but I wouldn't trust them with anything more complicated a current account and personal loan.