Recently-enlarged financial advisory group, Milestone, has signed on MyFiduciary as its new research provider.
Peter Coltman, Auckland-based director of the national Milestone business, said MyFiduciary would replace Morningstar as the group’s primary research provider.
Coltman said Milestone previously used Morningstar along with a mix of research sources to build its model portfolios and approved product lists (APL).
“But now MyFiduciary will be our go-to research advisers,” he said.
MyFiduciary would help construct Milestone model portfolios and review proposed APL products, Coltman said.
“We’re very pleased with what they’ve come up with,” he said.
Milestone, which merged in April with the Kepler Group to form one of NZ’s largest non-aligned advisory networks, has about $1.4 billion in funds under management across its 20 or so advisers. The underlying advice firms also include eight discretionary investment management services (DIMS) licensees.
Coltman said Milestone was reviewing its investment policy statement in light of the coming tougher obligations under the Financial Services Legislation Amendment Act (FSLAA).
“We developed our investment process with Morningstar to be best-of-breed but a different approach is needed [with FSLAA],” he said.
Milestone would expand the parameters for including investment products beyond the standard performance, volatility and personnel checklists, Coltman said.
For example, the upgraded product review process would also take into account manager capacity and fees.
“We can use our larger size to get fees down to benefit our clients,” he said.
The revised Milestone process also reinforces a client-centric view of investment suitability while applying dynamic asset allocation with a “small tactical overlay”.
“It’s a much more dynamic and flexible approach,” Coltman said. “We’re very excited with what Chris and Aaron have brought to the table.”
Despite the move away from Morningstar proper, Milestone would still be tapping into the research house’s resources through MyFiduciary. In June MyFiduciary inked an agreement with the firm to offer a bespoke version of the Morningstar Adviser Research Centre (ARC) tool in NZ.
Former Morningstar head of manager research Asia-Pacific, Chris Douglas, also joined MyFiduciary last year as principal. MyFiduciary is a governance and consulting firm headed by Ross Fowler and two former NZ Superannuation Fund senior investment specialists, Aaron Drew and David Rae.