Vanguard is ‘actively’ seeking collaborations for its custom model portfolio service (MPS) offering in 2024 as advisory firms face mounting cost pressures.
The US giant first broke ground on outsourced investment solutions in the UK last June by building a custom MPS for Rosebridge Asset Management.
Robyn Laidlaw, head of distribution for Europe at Vanguard, said an “increasing number” of advisers are choosing to outsource investments entirely and catering to this demand is “a key focus for Vanguard”.
Following its first custom MPS partnership, Laidlaw added: “We are actively seeking opportunities for similar collaborations and will continue to invest in all flavours of our model portfolio offer throughout 2024.”
The shift in focus to partnering with external advisers comes after the firm closed its internal financial planning arm in the UK last March following low traction.
However, Laidlaw noted Vanguard will be re-launching its content hub for UK advisers and making hires to cover portfolio consulting and analytics.
“In 2024, we want to be there not only to help support advisers support their clients, but also define and demonstrate the value of advice itself,” she added.
Laidlaw also noted the Financial Conduct Authority’s (FCA’s) Consumer Duty has prompted advisers to look for ways to reduce costs on their investment propositions, leading to “strong inflows” for Vanguard funds, “particularly regarding ETFs and on the fixed income side”.
