IG Group is launching a new investment partnership with the help from Blackrock, the company officially announced. The IG Smart Portfolios effort is aimed at retail clients that are not interested to actively trade the market themselves. The product consists of model investment portfolios with asset allocation advice from the biggest asset managers in the world, Blackrock.
Commenting on the launch, the Head of UK and Ireland at IG Group, Ian Peacock, said: “Our research shows that many investors are confident handling their own investment choices, but even so, a number are still being blindsided by fees. Hidden charges materially eat into investment returns and it is crucial that providers are transparent about all fees upfront, so that investors know the exact costs they will incur.”
“As we join the digital wealth management industry, we are keen to show that a low cost online service leads to greater consumer control and clarity, without compromising at all on quality. There will be no hidden fees when you invest with IG Smart Portfolios, meaning our client’s investments will work harder for them. Every charge an investor may incur is fully disclosed prior to opening an account and at all times while they invest with IG,” Peacock elaborates.
IG Smart Portfolios Using ETFs
There are a total of five IG Smart Portfolios that are constructed using iShares® exchange traded funds (ETFs). The team of the brokerage is constantly monitoring the performance of the products to adapt to changing market conditions.
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The CEO of IG Group, Peter Hetherington, elbaorates, “The launch of IG Smart Portfolios is an important step in the development of our investments offering. We see a huge opportunity in online investing, with strong demand from investors for online solutions and transparent fees.”
“Through our partnership with BlackRock, and building on our long-standing online trading technology expertise, we believe we have created a best-in-class offering for investors who are seeking an engaging digital low cost solution to their wealth management,” IG’s CEO concludes.
The low costs associated with ETFs and relatively low management fees from IG could open to door to investing for some retail clients that have previously ignored investment opportunities. Recently, a debate on the performance of index tracking investments when compared to money managers sparked by Warren Buffet winning a million dollar bet put the focus back on the underperformance of a number of assert managers.
By using ETFs, IG Group is introducing relatively low fees with total cost of ownership for clients investing under £50,000 amounting to 0.9 percent per year.