|
Category:
Insurance News /
Investments /
March 2010
New Online Platform To Shake Up Unit Trust Industry
Investonline.co.za has launched South Africa's first online portal
that enables customers to invest in a comprehensive range of unit
trusts in a cost-effective, convenient and user-friendly way, while
providing them with independent advice to ensure they choose the
funds which best meet their specific investment needs.
investonline.co.za is headed up by Nick Brummer, former director at
HSBC Securities and Deutsche Securities, and fellow director Rod
Lowe, former wealth management specialist at Nedbank Private Bank,
HSBC Securities and Syfrets Private Bank.
According to Brummer, the company aims to change the way retail
investment products are sold in
South Africa.
He
says that one of the key benefits of investing via an online
platform is the much cheaper cost structure. "investonline.co.za has
no upfront fees as we pass on the wholesale price of unit trusts to
our clients."
"This provides substantial savings compared with traditional
investment advice routes, who typically charge between 2% to 3%
upfront."
Only A class unit trust funds are used by investonline.co.za which
means there is no layering of fees and any rebates negotiated with
the various unit trust management companies is passed back entirely
to the investing client.
Brummer says that by removing the upfront fee consumers are
effectively now in charge of their own investment portfolios via the
website. "Not only do we offer transparent access to a range of
underlying unit trust funds, but clients are also able to switch
freely between underlying funds and to construct portfolios at a
very cost-effective price."
investonline.co.za has an easy to use calculator on its website that
consumers can use to identify how much they can save compared with
investing through traditional channels. As illustrated in the table
below, the reduction in fees for customers investing in unit trusts
through investonline.co.za can result in substantially higher net
returns over a longer period of time.
|
|
Traditional Route |
investonline.co.za |
|
Initial investment |
R100 000 |
R100 000 |
|
Number of years invested |
10 |
10 |
|
Return per annum |
15% |
15% |
|
Yield |
R341 656 |
R381 261 (12% higher than the traditional route) |
"investonline.co.za
is not affiliated to any particular provider, which allows us to
provide truly independent advice," says Brummer. "The portfolios we
have chosen are well diversified and independently selected to
ensure that we can offer all our clients a portfolio that meets
their individual needs."
The
company has structured a range of risk profiled and diversified unit
trust investment portfolios from the top-performing unit trust
providers in South Africa, including Allan Gray, Coronation Fund
Managers, Flagship, Foord, Futuregrowth, Investec, Nedgroup
Investments, Prudential, RMB, Sanlam Investment Management and
Stanlib.
The
minimum monthly debit order is R2 000, while the minimum lump sum
investment is R20 000.
While clients can choose from any major unit trust provider, the
underlying investment platform is managed by Allan Gray Investment
Services, who provide all administration services to clients, such
as payment collection and regular reporting updates.
"We
have also developed a personalised Risk Profiler tool - which is
mandatory for clients to ensure they invest in the correct
underlying portfolio of funds that best suits their specific
objectives," says Lowe.
 |
