New research* from Legal & General Investments, one of the UK's largest investment providers, reveals that more than half of IFAs (57%) expect to see a rise in DIY investors in the next 12 months.
The findings come from Legal & General Investment's What Matters Investment Index which investigates IFAs views of the market over the coming year.
When asked how RDR would affect consumers' investment behaviour, more than half expected an increase in DIY investors. Of those, 62% believed that the likely outcome from this development would be an increase in the number of providers offering direct to consumer products/solutions.
Not surprisingly almost a third (32%) of IFAs are pessimistic about the increase in DIY investors, stating that they expect their business to suffer. Eight in ten (79%) IFAs thought consumers would end up with unsuitable investments products with 28% anticipating the move to DIY investing would create more complaints to the FOS.
Simon Ellis, Managing Director, Legal & General Investments, said:
"With the impending changes to the provision of advice under RDR it is no surprise that IFAs are expecting to see more DIY investors enter the market. However, one can understand why they are guarded over whether clients will make the best decisions.
"Personally I would not be surprised if private investors turn to the internet more as the place to research and buy funds. The challenge for providers and advisory firms is to decide whether they wish to participate in this developing market, and if so to ensure consumers make well-informed decisions."
The Legal & General Investments What Matters Investment Index aims to investigate the future expectations of the intermediary market.
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