Mercer Investment Consultinghas launched a retail investment research platform targeted specifically at the financial planning market, in direct competition with other providers such as market leadervan Eyk Research.
The web-based service, to be known as Mercer IS, will aim to provide “industrial strength” research to advisers through the use of the group’s global scale and large existing research budget.
Mercer Investment Consulting national practice leader Christopher Andrews says that he thinks the group’s research quality and depth will surpass that of competitors as it opens up its research capabilities, previously reserved for its institutional clients, and repackages its delivery and content for the advisory market.
The research service will provide fund manager and retail investment product research and ratings, as well as services such as news, market data and analysis, asset allocation tools, and risk and style-based information.
Mercer research co-head Chris Durak says it will provide both strategy and product ratings, which equate respectively to skill and cost ratings. These will be calculated both before and after management expense ratios are factored in as he says Mercer finds that one in four funds get penalised in their rating as a result of their cost structure.
Andrews says that although Mercer has traditionally operated in the institutional and superannuation space, the group has chosen to evolve into the retail space as it is the fastest growing area of the market.
“Given the fact that 30 per cent of Australian super assets is now managed in the retail and master fund space, it makes sense for Mercer to have a prominent presence there,” Andrews says.
Though Mercer flagged its interest in retail research in its negotiations to buy van Eyk last year, Andrews says when this fell through, the group decided not to buy, but to build.
The IS service, to be available only to paying subscribers, will be charged at a base fee of $15,000, plus $500 for every individual user of the service.
Mercer head of retail consulting Cecily Williams says that the group’s discussions with planners has led them to believe there is a gap in the market for quality research tailored for sophisticated investors.
“No one wanted mass-produced, cookie-cutter research,” she says.
