Hargreaves Lansdown marketing just a load of rubbish?

almondsalty

I've always treated information and marketing from investment companies with a pinch of salt, although I am pretty shocked to see the lengths Hargreaves Lansdown go to.

http://www.investoo.co.uk/hargreaves-lansdown-fund-marketing-brilliant-or-brash/

Does anyone else see any value in their marketing or use it? Would be interesting to see. I think the above shows why it really cannot be trusted and I've always had my suspicions .

blinko

What is wrong with what they are doing ?

almondsalty

blinko wrote: »

What is wrong with what they are doing ?

According to the Daily Mail they take secret commission to promote funds into 'Wealth 150' list. They refuse to reveal this commission. But then the list is sent out to lots of people and presented as unbiased based on complicated procedures for admission. But the new Malborough fund has gone straight in with no track record. It's competitors hold off from rating the fund, but HL sing its praises everywhere.

A lot of investors are unaware of this and if there are ill agendas behind what is presented as unbiased, honest information.

blinko

almondsalty wrote: »

According to the Daily Mail they take secret commission to promote funds into 'Wealth 150' list. They refuse to reveal this commission. But then the list is sent out to lots of people and presented as unbiased based on complicated procedures for admission. But the new Malborough fund has gone straight in with no track record. It's competitors hold off from rating the fund, but HL sing its praises everywhere.

A lot of investors are unaware of this and if there are ill agendas behind what is presented as unbiased, honest information.

And in your mind, how did you think the wealth 150 was generated ?

almondsalty

This is the exact question a lot of people are asking! According to HL it is from a rigorous selection process and a complex maths modelling, but no methodology is detailed and a lot of people are becoming suspicious of selections.

The question is not for me to answer but HL themselves don't you think?

dunstonh

Treat the marketing from HL in the same way you would treat marketing from the likes of Aviva.

According to the Daily Mail they take secret commission to promote funds into 'Wealth 150' list. They refuse to reveal this commission. But then the list is sent out to lots of people and presented as unbiased based on complicated procedures for admission. But the new Malborough fund has gone straight in with no track record. It's competitors hold off from rating the fund, but HL sing its praises everywhere.

Thats a bit misleading. HL are paid hidden commission rebates on funds. Not all funds pay it and all platforms/distributors get it but the amount varies depending on the agreements in place with each firm. It is effectively a marketing payment.

unlike IFAs, there is no requirement for the platform to disclose this information and you must not think of HL as an IFA in this case as they are a product provider. The 150 is not an advice list or a recommended list. It is a marketing list with some pretence to being more than it is.

The hidden commission certainly does allow for the potential of bias. Which is why the FSA is expected to ban them in their publication next month (although it may backtrack and just make disclosure a requirement).

Most platforms and product providers will do some form of due diligence before allowing funds on their platform/product. Most providers will promote their product and services to try and get more business and as they are not giving advice (even when it may be dressed up to look like it) they dont have to justify what they are promoting.

kar999

It's no worse than assuming comparison websites provide independant comparisons!! They are all owned by someone with a vested interest, e.g. Admiral Group own Confused.com, and they all get "kick-backs".

... and I suspect they all sell on our details.

Old_Slaphead

kar999 wrote: »

It's no worse than assuming comparison websites provide independant comparisons!! They are all owned by someone with a vested interest, e.g. Admiral Group own Confused.com, and they all get "kick-backs".

... and I suspect they all sell on our details.

Trustnet ?

dunstonh

Trustnet is the free cut down version of the Financial Express Analytics service which is a paid for service.

Financial Express are paid to show that data and they also charge the companies using the full data for accessing it. If a provider does not pay FE to show the full data then FE will not display it.

Also, the fund rating companies (S&P, OBSR etc) will not rate a fund if the provider/fund house hasnt paid them to rate their fund.

jimjames

almondsalty wrote: »

But the new Malborough fund has gone straight in with no track record. It's competitors hold off from rating the fund, but HL sing its praises everywhere.

The same happened with a new Lindsell Train fund. I hold the UK version of their fund that has experienced managers and a good track record. HL has no info on it as it "is not one we rate or popular with our customers"

Lindsell Train launch a new fund and it immediately goes into the 150 due to the managers experience. Yet the UK fund with the same managers AND track record isn't rated at all! Maybe due to the much lower TER for the UK fund at under 1% (very low for managed fund) so commission payment is not enough.

jamesd

almondsalty wrote: »

According to the Daily Mail they take secret commission to promote funds into 'Wealth 150' list. They refuse to reveal this commission.

According to Hargreaves Lansdown quoted in the Financial Times a couple of weeks ago they will tell their customers the payments that they receive if the customer asks. So if you're a HL customer, ask.

HL's disclosure of what they receive isn't great. It should really be disclosed per fund on the fund summary pages in my opinion. But that would show them getting 0.8-0.9% from many funds and that's around three times what a normal platform gets because HL is also getting the IFA commission.

Hargreaves Lansdown also denied taking payments for placement on the Wealth 150, though correspondence quoted in the FT from one fund manager suggested that a listing on the site was contingent on them paying what HL was asking in the way of commission/charges.

I haven't seen anything from HL that would cover whether they do or do not receive marketing payments for banners and such on their site.

Whatever the market situation HL will always find something to promote, since they appear to believe that it is in their best interest to portray every development as positive for investing in something.