St James’s Place.

[ZealAndArdour]

Hi,

Just wondering about this company. I understand they’re quite legit and well known.

My dad (not vulnerable, self employed, works still, only vulnerability is my siblings death a few years ago and he lives alone) is very shrewd and has always looked after his assets, saved very hard and tried to make sure we’d all be okay in the future. He’s been using them for several years for various things; consolidating pensions, setting up an asset preservation trust, etc.

But he seems to be in quite regular contact with his advisor (I’ve met the guy to sign paperwork and have some things explained to me, he seems nice enough) and has also received a lot of referred business from my dad making recommendations to friends, etc. The advisor is now taking my dad and some of his pals on quite fancy days out to thank them for the referred custom and just seems to still be very much involved in everything, I thought the things he’d been engaged for were sort of contact-Intense to begin with while they were set up and then might just be yearly reviews of everything. But my dad will still get calls from this guy quite frequently, and he’ll say “oh I’m not answering that, it’s Charles, he probably wants me to invest some more money, he can wait”.

I’m just wondering if this is a normal level of continuous involvement with the financial advisor, I know my dad has good pensions and a respectable portfolio of assets, but unless I’m totally in the dark I don’t think we’re talking millionaire status.

Could there be anything shady going on? Is the financial advisor meant to be in contact this much and taking them out?

My dad would also like me to meet with him to discuss my pensions and assets and tbh I just find the smarming all a bit much, and this level of contact too intense to maintain.

Thanks.

@HauntedPencil

cheaper elsewhere? maybe diy but not like for like

https://www.thetimes.co.uk/article/leaked-document-reveals-the-uks-priciest-wealth-managers-slzljcspj

SJP don't offer anything groundbreaking, what do you mean not comparing like for like?

You using an unverified sales aid using figures compiled by SJP 5 years ago with no context to promote SJP.

@HauntedPencil

its complied by The Times audited by Grant Thornton.

Why are you tagging me in? I haven't looked it's pay to view.

Extracts from today's FT

For much of the past quarter century St James’s Place was a stock market darling as it rose from a start-up based in the Cotswold Hills to the largest wealth manager in the UK.
But the past two years have been bruising. About half its market value or £3.8bn has been wiped out as client inflows have slowed, several of its biggest funds have underperformed and regulators have cracked down on inappropriately high fees.
SJP charges 4.5 per cent upfront for initial advice, as well as 0.5 per cent annually. Investment and product charges are additional.
Analysts at JPMorgan Cazenove estimate about a quarter of the company’s revenues come from initial fees.
After a client has been with St James’s Place for six years, the company applies an annual “product management” fee of up to 1 per cent. Last month, SJP reduced this to 0.85 per cent, although only those who have been with the firm for at least a decade about 65,000 will benefit.
UBS analysts estimate the reduction will reduce the group’s earnings 8 per cent or £40mn next year.
The tacit admission that some of its fees do not represent “good value” under the new FCA criteria is the latest reputational hit to SJP.
The company was forced to overhaul pay and perkss_ three years ago after the Sunday Times reported advisers received lavish rewards, including cruises, for hitting sales targets.
SJP advisers can recommend only the company’s own investment products, in contrast to independent financial advisers, who have no such restrictions.
Whether clients benefit from the arrangement is unclear. SJP’s figures show that 41 per cent of UK clients’ assets under management were in funds that delivered “insufficient value” last year.
Last month, six of its funds with a combined £29bn under management were included in Bestinvest’s twice yearly “Spot the Dog” reportt_ that identifies the worst-performing funds over a three-year period.
Some clients complain SJP’s fee structure has long confused them. One said he encountered “obfuscation” when he asked for a breakdown. “It was never entirely clear,” he said. A former SJP adviser said “[SJP] advisers do not understand it either.”
The former SJP adviser said it was “unbelievable” that the FCA has not yet forced the company to remove the exit fees.
“The client is locked into SJP, [with] an underperforming and expensive fund range whether they like it or not.”
The FCA declined to comment on SJP’s fees. The regulator said that generally, financial products must “provide fair value”.
Clients are subject to exit fees starting at 1 per cent, which in some cases can be applicable for the first 11 years. Total charges can be as high as 7.5 per cent if customers withdraw their money in the first year.
Most SJP clients were “unaware” of “poor long-term performance and high charges”, fund researchers at Yodelar said in a report in March. “Those that are aware are often tied in.”

Sorry the underlined text was in brackets but couldn't remove the formatting

I don't think some posters will be returning to comment on that.

@grass321

I would rather trust analysts rather than journalists. Clearly a market leader in what the do SJP and as for the fees, other like for like wealth managers charge more but true if you invest in a DIY basis it’s cheaper.

Been hearing this obsessive drivel for years and the company keeps bringing in billions of client money. Clearly clients like what they do and clients are aware of their options elsewhere.

https://www.thetimes.co.uk/article/st-james-s-regains-its-place-in-the-city-s-affections-after-upgrade-5rj6pc5r0

https://www.investmentweek.co.uk/news/4121643/bank-america-upgrades-st-jamess-share-plunge

Which is amusing since you've dismissed the views of those who work in investment analysis, including mine.

And, by the way, those of us who work in investing view the FT as one of the most respectable and well-regarded publications. I note you haven't refuted anything as factually inaccurate, I very much doubt SJP will either, given that the article will have gone through legal & compliance checks before publication.

If I was reading this thread as an investor, personally I'd gravitate towards the dispassionate and objective posts rather than those that have resorted to childish insults.

I’m not taking it personally because I suspect that @BrokerG simply has or had some sort of affiliation with SJP and may have personally been a recipient of funds derived from the fees charged by SJP. And / or they may currently hold shares or other financial instruments tied with SJP share price.

The few facts they describe are easily compatible with the view that SJP is a rip-off:

-they can have high AUM and sometimes inflows due to the combination of aggressive marketing, effective hiring and management of an effective sales force, and high exit fees
-they can be cheaper than certain other large wealth managers because those are even more of a rip-off.

You do realise this is the financial times you're rubbishing? The journalists there are from the financial sector and they don't print drivel. The facts are what they are.

This is a very odd reaction from someone who clearly has skin in the game. I wouldn't like my money to be with you if this is how you treat the facts.

@Ingrainedagainstthegrain

read this

https://www.vouchedfor.co.uk/network/2-st-james-s-place

i would rather read reviews from clients who have first hand experience rather than journos selling stories based on negative news whic as we know sells more than positive.

I would rather know the facts. Clients are the last people to know, simply because if they are clients and require that kind of financial support, they are not in a position to know the kind of indisputable information given in the financial times article. Really, there is no way to put a gloss on it. SJP funds are under performing and their fees (legendarily high) are entirely inappropriate at the best of times but particularly so in the circumstances. You are either a non professional who needs to believe your money is safe or you have links to SJP because no one - no one - would respond to this damning information as you have done otherwise.

And if you want to second guess a publication that is known for accurate, reliable information distribution that is fine. Just go to the primary sources (such as the list of shame SJP has repeatedly made it onto recently) and have a look for yourself.

Interesting to read this..my FIL has invested with SJP. I know he hasn't been happy with performance, he knows the fees tend to be on the higher end but I'm not sure he was aware of exit fees.

Think I'll ask him to speak to an IFA and get projections from SJP for withdrawing money.

Over a day or a year anyone might beat the market.

The longer the time frame the markets beat active traders. Therefore if you save and invest for retirement over decades your best options is to buy a broad index fund.

People investing in passive/tracking funds tend to be passive.
People investing in active funds tend to be less passive so will amend investments as the market cycles change over time.

It's not a two horse race over 20 years between a single active and a single passive fund, it's often multiple active funds as others point out. In downturns or odd events (think pandemics) active funds can behave very differently

@Ingrainedagainstthegrain

you're waisting your time. Go shop at Aldi, drive your Skoda and buy your market tracker. Not everyone is like you though.

Or even wasting your time. Which probably sums up this thread fairly well.

I'm not sure what you're implying? Our cash is doing well, much better than if it was invested with SJP.

Broker G, you aren't selling it mate.

I think on the active v passive issue nowadays people tend to use a mix - using passives in funds it might be less likely active management can significantly outperform and keeping costs low perhaps

Although, keeping costs low is certainly not on the agenda for SJP.

If I had a relative with a holding with them, I would suggest taking a look around but unless they want to manage the funds themselves there will be ongoing advice charges to pay wherever you go, but SJP do have large fees compared to most!

If I had a relative with a holding with them, I would suggest taking a look around but unless they want to manage the funds themselves there will be ongoing advice charges to pay wherever you go, but SJP do have large fees compared to most!

Same, the market has become very competitive.

HL charge 1.4% for their ready-made portfolio service (including the platform fee) or 1% for individual financial advice. AJ Bell charges around 1% for their ready made portfolios and the more competitive robo advisers charge around 0.8%.

Or if you like passives, Vanguard's managed ISA costs 0.6% all in, or they offer LifeStrategy and TargetRetirement funds.

https://www.yodelar.com/insights/which-perform-best-active-funds-or-passive-funds-the-facts

This article is based on data re active versus passive funds. There is a place for both, but as investors we only have access to some sectors if we only want to be passive, a blend may seem the best thing.