Investment research | Analytics+ Reduction in yield calculator

Calculate and compare the impact of costs on client portfolios with ease

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FE's new Reduction in Yield calculator allows Advisers to calculate and compare critical yield and reduction in yield on any portfolio including pensions, bonds and ISAs. The RIY tool has been specifically built to help Advisers demonstrate the impact of charges on a client's portfolio across customised time periods, growth rates, and charges.

SPEAK TO A SPECIALIST

What is Reduction in Yield and why is it important? 

FCA regulation requires Advisers to undertake appropriate cost comparisons on any replacement business they undertake, factoring in all costs involved. This can however often be laborious and time-consuming in scenarios like pension transfers, as they are largely reliant on projection comparison data from product providers. The projection figures often don’t factor in every type of charge (e.g. Adviser charges) and aren’t always wholly objective as they are generated by the product provider.

A simpler and more efficient approach to assessing the impact of costs on a portfolio is to calculate the reduction in its yield (RIY) after accounting for costs such as set up charges, exit penalties, ongoing charges, Adviser charges, provider and fund charges. Not only is the RIY figure more inclusive in terms of costs considered; it also gives investors a comprehensive yet intuitive view of the impact of costs on their portfolio and expected returns in the future.

Why use FE Analytics+ Reduction in Yield Calculator?

FE's ISO certified data collection processes collect a variety of charges data; made available on the FE Analytics research solution. Users of FE Analytics have access to these charges alongside the capability of entering their own charges and any platform charges in order to truly ascertain the yield/returns of their proposed portfolio against the client’s existing arrangements.

FE Analytics+ Reduction in Yield Calculator brings these elements together to allow users to easily calculate and compare the impact of costs on the yield of one or more portfolios viewed side by side across customised growth rates and time periods.

The tool is free to FE Analytics subscribers.

Benefits to Advisers:

  1. Save time : Advisers no longer have to rely on product providers for projection data that can take weeks to arrive! The RIY calculator offers a quick and easy method of comparison.
  2. Transparent: the RIY calculator makes cost comparison a truly transparent process. With its sleek, user-friendly interface, the calculator can be used in front of clients during meetings
  3. Reports: What's more, the outputs generated by the calculator can be exported for use in client reports, printed and/or emailed to clients...
  4. Compliant: The RIY calculator is compliant with current FCA guidance on replacement business and is has been independently verified by Apricity Compliance.

Don't just take our word for it

“The new Reduction in Yield calculator in FE Analytics is great as it is a straightforward, step by step tool that allows you to see the impact on the clients’ monetary value of the charges levied againsttheir investment. The calculator allows you to drill down to a good level of detail on each charge, is flexible enough for most investment types and provides a clear and transparent summary for clients that can be included in client reports.''  Read more
- Cathi Harrison, Founder of Para Sols and Apricity Compliance 

“The FE Reduction in Yield calculator is unique in that is allows for a reduction in yield calculation for any investment type, allowing an adviser to demonstrate the effect of all charges on a clients’ portfolio. Ultimately it’s a much more transparent approach for consumers so they can see the true effect on their portfolio.”  Read more
- Andy McGowan, Director of Financial Planning, Charles Stanley

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