UN­CON­VINCED

Finweek English Edition - - FEEDBACK - Gregg Sned­don

I read the “de­fence of the in­de­fen­si­ble” ( Fin­week, 12 Septem­ber) by San­lam in re­la­tion to their new Echo RA… does any­one re­ally un­der­stand all that and why does it have to be so com­plex, es­pe­cially when it is aimed at the ‘less so­phis­ti­cated’ in­vestor? What chance does he/she have of ever mak­ing sense of what he/she is get­ting into?

I still don’t think that you can beat a unit trust or an in­dex RA for sim­plic­ity, costs, trans­parency and f lex­i­bil­ity. Per­haps the ques­tion that needs to be put to all the ac­tu­ar­ies, prod­uct de­vel­op­ers and mar­keters be­hind the Echo RA is how much of their own money each of them has in­vested into it? And if they have not, why not?

I sus­pect that very few of them will ac­tu­ally put their own money into this RA and the rea­sons for this will be ex­actly the same rea­sons that the or­di­nary man in the street should not do it ei­ther: It is too com­pli­cated It is too ex­pen­sive and It is too in­flex­i­ble, and you will only get the bonus if you don’t break the con­tract over the term…

Far too many terms and con­di­tions for my lik­ing… I won’t use it for my­self and I cer­tainly won’t in­vest any client into a prod­uct into which I have not also in­vested.

The Fi­nan­cial Coach

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