Low interest rate environment creates adviser opportunity

Senior analyst Ian Robertson said the fund manager was seeing more people looking for alternatives to bank deposits as the low interest rate environment continued. “We are now seeing investors make inquiries and consider their alternatives, such as investment funds, as their term deposits mature and they’re faced with even lower rates moving forward.”

The main banks are all offering term deposit rates below 2.7% out to five-year terms.

Head of private wealth Philip Morgan Rees said advisers who picked up clients as part of that shift would have to explain the difference between a term deposit and an investment fund – and how the fund was structured and managed, with capital gains potential.

“The other big thing is fees.”