Almost half of the UK’s top fund management houses have yet to disclose how they will pay for research under the Markets in Financial Instruments Directive (MiFID II) when the EU law comes into force in January, according to new research.
Figures compiled by the London-based financial markets consultancy firm Alpha FMC found that:
- 40% of fund houses in the Investment Association’s Top 50 have made no comment on whether they will charge clients for investment research;
- With only three months until MiFID II comes into force, nearly a tenth of firms (8%) have not yet finalised their plans for paying for research;
- 48% of fund houses have confirmed they will absorb the cost of research and analysis onto their own balance sheets;
- Just 4% of firms have said they will pass broker research costs on to their clients.
Andrew Glessing, head of regulation and compliance at Alpha FMC, said that in recent weeks a clear trend to absorb the cost of research, particularly among larger firms, had become discernible.
“The direction of travel is becoming increasingly clear and the way that research will be consumed, assessed and paid for by asset managers will look very different in 2018 as a result of MiFID II,” he said.
“Nevertheless, the clock is ticking for those firms which have yet to make a choice and will therefore have a limited time to implement their decisions.”
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