The Fidelity Guidance Service has launched, giving investor new options when it comes to shaping investment decisions. The Fidelity Guidance Service is a direct response to the ‘Guidance Gap’ which has left millions of investors without a financial adviser following the Retail Distribution Review (RDR). The ‘Guidance Gap’ also includes those investors who do not have full confidence to make their own investment decisions.
Fidelity’s Guidance Services goes a step beyond what is typically available at a typical online discount fund broker. While most discount brokers will offer a list of recommended funds and fund research, Fidelity’s new service is different in the fact that it provides additional support. This support and guidance comes in the way of:
- PathFinder Range: Using Fidelity’s investment expertise and experience, Fidelity has developed an exclusive range of well diversified, mixed-asset options that savers can choose from, based on their attitude to risk. Each fund has a mix of up to five asset classes (cash, bonds, equities, property and commodities) based on different levels of risk, invested in a variety of underlying funds chosen by their experts. The PathFinder range also benefits from ‘tactical asset allocation’, where Fidelity’s team alters the asset mix based on their expectations of future market moves. 10 of the 15 funds are open architecture.
- HeadStart Portfolios: A selection of open architecture portfolios based on an individual’s attitude to risk or themes that Fidelity believes are likely to be important in the years to come such as income, emerging markets and the ‘two-speed world’. HeadStart offers investors the option to select a ready-made selection of funds or to choose their own funds based on the pre-determined asset allocation suggested by Fidelity’s experts. Investors must then take responsibility for monitoring their funds and rebalancing in response to changes in the markets according to their personal circumstances and attitude to risk.
The service also includes an online questionnaire to help new investors decide what type of investment vehicle is suitable to their needs, for example an ISA or a regular fund and share account.
For those who have more confidence to ‘go it alone’, Fidelity also offers ‘The Select List’ of funds (recommendations by its experts) as well as full access to invest in a range of thousands of funds.
With the continued influx of competition within the direct-to-consumer investment marketplace, Fidelity’s Guidance Service appears to have taken the first step in developing a solution to meet the needs of investors who are making their first move into investing following the consequences of the RDR.