MIFID ISSUES

1
ATR Soft Facts
2
ATR

• Scale approach
• How many numbers?

3
ATR

• Scale approach
• How many numbers?
• Low Medium High
• 1-5
• 1-10
• 1-20
• Zero?

4
ATR

• My primary concern is my Child
• I am OK
• I want to pass on as much as I can to them
• I dont need any income.

5
ATR

• My primary concern is my Child
• I am OK
• I want to pass on as much as I can to them-
• I dont need any income.
• - Which of your 1-10 will give most money to my
  child?

6
ATR

• Consider what they already have
• Cash ISA
• Cash ISA and Equity ISA
• Equity ISA lots of old PEPs
• Endowment Mortgage
• Are they making a significant risk change?

7
ATR

• Consider what they already have
• ON PENSIONS
• With profits
• Managed fund
• Lifestyle
• Property

8
ATR

• Can they really afford to take a risk?
• Should the adviser advise?
• What is current general financial position?
• What is likely position on retirement?

9
ATR

• Preferred retirement age?
• Does that affect ATR?
• Is it possible?
• Is it achievable?

10
ATR other factors

• Size of investment
• Relative importance
• Inheritance
• Time the money will be fully invested
• Job expectations
• Health

11
ATR

• Fund choice must MATCH ATR
• As defined in fact find!!!!
• NOT
• Stochastic modelling
• guessed risk!

12
ATR

• PRODUCT must match ATR
• Advice must match ATR

13
Soft Facts

• Hobbies
• Attitude to children/ inheritance
• General lifestyle in retirement
• Downsize house

14
Soft Facts

• Expected Inheritance
• Planned purchases e.g. boat, holiday home
• Running costs in retirement
• Eating out
• Expectation policy performance

15
Outcome 5 - Client Expectations

• Expectation policy performance
• Customers are provided with products that perform
  as firms have led them to expect and the
  associated service is both of an acceptable
  standard and as they have been led to expect