Sipp firms: Demand for non-standard investments despite ban

Sipp specialists say there is still an appetite and a place for non-standard investments, after James Hay banned them for new customers. James Hay revealed the move yesterday, saying there was dwindling demand and risk appetite, adding that it made the decision based on talks with advisers. Read more on this HERE.The platform said it will continue to fulfill its obligations with regard to existing NSIs, but it was “not appropriate to continue allowing the purchase of further NSIs”.Dentons and Mattioli Woods told Financial Planning Today there was still a role for NSIs.Martin Tilley, director of technical services, Dentons Pension Management, said: “Unlike James Hay, we have not seen a reduction in demand for legitimate and genuine NSI’s such as unquoted equity, third party lending and UCIS for the HNW/Sophisticated investors, nor do we envisage a reduction in future. "Whilst these assets also represent a significant minority of our own AUA, we intend to continue to offer them alongside our standard investment classes.“There will therefore continue to be an ongoing core of specialist Sipp providers who will continue to include NSI’s as part of their strategy."Murray Smith, group managing director of Mattioli Woods, said: “As part of our pension product range Mattioli Woods very much believes in offering a full bespoke Sipp that represents a powerful financial tool carrying the flexibility to offer the control, choice and diversification needed to deliver and maintain robust client pension strategies.“It is primarily about suitability. There is still a place for non-standard investments, but it has to be the right type of business and the right type of client. It is also about systems and controls, and Sipp providers need to be able to demonstrate to the regulator the safeguards they have in place.“Whilst the need for controls, diligence and security is paramount we do need products that can enable innovation and thinking outside the box in terms of investing money as part of a wider strategy.”He added: “Perhaps it’s time we saw more definition in the Sipp market to differentiate between what is a true Sipp and what is a simplified wrapper that only facilities purely vanilla investments. This would create clarity for consumers.”

Sipp firms: Demand for non-standard investments despite ban

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