Lighthouse Regulatory News (LGT)

12 Jun 2007 07:01

Lighthouse Group PLC12 June 2007 Press Release 12 June 2007 Lighthouse Group plc ("Lighthouse" or "the Group") Lighthouse launches client Risk Matching Initiative Lighthouse Group plc (AIM:LGT), one of the UK's largest Independent FinancialAdviser groups and pension scheme administrators, today announces the immediatelaunch of a major new Client Risk Matching Initiative for IFAs and theirclients. Highlights• The pioneering use of a psychometric fact finding process means that the resulting asset allocation for clients is most appropriately and intimately matched with their attitude to risk• Dynamic risk profiling updated quarterly to ensure the continued suitability of the client's investments• A directly linked unfettered fund of funds to match asset class volatility with marginal outperformance on a regular basis in order to produce consistent returns for the client over the long term• By using this system both IFAs and Lighthouse Group plc centrally will be able to more easily monitor and influence the assets that are recommended to clients Malcolm Streatfield, Chief Executive of Lighthouse, said: "Lighthouse is one ofthe first leading financial adviser groups to make this system available toIFAs, and is at the forefront of this advance in risk profiling. The process isextremely compliant and auditable. Using the fact finding process togetherwith the unfettered fund of funds readily evidences that clients are beingfairly and professionally treated." Risk Matching Initiative detail The initiative means that Lighthouse is now in a position to offer its advisersa psychometric fact finding process, designed by Distribution Technology Ltd,which uses behavioural finance principles to create a client risk rating. Thisis then replicated by an investment with precisely the same risk profile interms of targeted volatility on an ongoing, quarterly updated, basis. The underlying investments are a range of unfettered fund of funds recentlylaunched by F&C Management Ltd (F&C) under the "Lifestyle" banner. This is theonly offering of its kind currently available in the UK to provide an automatedasset mix tailored to fit the risk profiles of specific categories of investoras determined by the fact finding process. Within the asset allocation, the fund selection utilises the F&C multi-managerdepartment under Richard Philbin and their in-house "Traffic Light AnalysisSystem". The aim is to match asset class volatility with marginal outperformance on a regular basis, which should produce consistent returns over thelong term. In addition, the performance of the funds will be monitored on a regular basisagainst agreed benchmarks by Andy Gadd, Head of Research at Lighthouse. Thisprovides an added degree of reassurance for the IFAs and ultimately theirclients. As part of the arrangements, F&C will provide logistical support for Lighthouseand its IFAs in applying this Risk Matching Initiative to existing and newclients. IFA/Client Relationship With the retail financial industry moving increasingly towards long term clientrelationships, matching risk with asset allocation and stock selection is moreimportant than ever. Risk rating is vitally important and the benefits ofgetting it right are very significant. From the client's perspective there is the opportunity to avoid unwantedinvestment experiences which are either too risky, or indeed "too conservative"where investors take an inappropriate "low risk" investment strategy at the riskof significant opportunity cost. Andy Gadd, Head of Research at Lighthouse said: "Eventually even initially wellconstructed, balanced portfolios with the right asset allocation and a goodchoice of funds can drift over time into a shape that no longer meets thatclient's objectives or risk profile. When combined with the need to monitor inexcess of 2,200 authorised retail funds it is becoming increasingly difficultfor advisers to ensure the initial suitability of fund choice and then thecontinued suitability for each client. This new initiative therefore marks a major step forward in terms of matchingclient risk and asset allocation and stock selection. Lighthouse advisers willalso be able to more easily show that the advice they give to clients iscompliant and that they are treating customers fairly." - Ends - For further information, please contact: Lighthouse Group plcMalcolm Streatfield, CEO Tel: +44 (0) 20 7065 5640malcolm.streatfield@lighthousegroup.plc.uk www.lighthousegroup.plc.uk Daniel Stewart & Company plc Lindsay Mair / Chloe Ponsonby Tel: +44 (0) 20 7776 6550 www.danielstewart.co.uk Media enquiries: Abchurch CommunicationsHeather Salmondheather.salmond@abchurch-group.comGareth Mead Tel: +44 (0) 20 7398 7700gareth.mead@abchurch-group.com www.abchurch-group.com Notes to Editors About Lighthouse Group The Lighthouse Group plc is one of the UK's largest Independent FinancialAdviser groups and pension scheme administrators. The Company provides support to close to 600 IFAs across the UK who, in turn,provide fully independent financial planning advice to both private andcorporate clients. The Company has in excess of £5 billion worth of funds underinfluence. Based in five main operational centres, in London, Manchester, Brighton, Exeterand Reading, the Company has grown rapidly through both organic growth and keyacquisitions since being admitted to AIM in October 2000. About F&C The F&C Asset Management Group (F&C) is a London Stock Exchange listedpan-European asset manager. Friends Provident, the FTSE 100 insurance group, isF&C's majority shareholder. F&C manages £102.7 billion (as at 31 March 2007) fora diverse range of institutional, insurance and retail clients. F&C has officesin eight countries: France, Germany, Ireland, The Netherlands, Portugal,Switzerland, UK and United States. F&C has a major presence in the UK retailmarket with strength in corporate bonds, UK and European equities, multi-managerand ethical funds. F&C is a leading force in the UK investment trust industrywith the flagship Foreign & Colonial Investment Trust being the first suchtrust, launched in 1868. The company is also a pioneer in socially responsibleinvestment having launched the UK's first ever retail ethical fund, theStewardship Growth Fund, in 1984. For further information on F&C Management Ltd, please contact KarolinaAdamkiewicz on 020 7011 5011, or karolina.adamkiewicz@fandc.com. About Distribution Technology Distribution Technology is the leading provider of advice technology in the UK,working with over twenty five of the country's leading banks, life and pensioncompanies, wealth managers, platforms and building societies. The team atDistribution Technology wholeheartedly believe in the advice process, that's whythey develop exceptional, tailored solutions to dramatically enhance theprofitability and compliance of advised distribution. For further information on Distribution Technology, please contact UrsulaDelaney or Sam Holl at Teamspirit PR on 020 7438 9400. This information is provided by RNS The company news service from the London Stock Exchange