The boss of Tatton Asset Management has pledged to stick to what the firm is good at - running a managed portfolio service.
Paul Hogarth said the investment manager was aware of the trend of vertical integration in the industry at present, and platforms entering the DFM space with model portfolio tie-ups (see the Transact – BlackRock partnership), but added Tatton was set on staying in its lane.
Though, he admitted, the business too had tossed up becoming a platform at some point, before abandoning the idea and positioning itself solely as a discretionary fund manager.
"We have...thought about becoming a platform ourselves and decided against it," said Hogarth.
"A lot of platforms have come into our world but we don’t think it is the right thing to do, we are not a tech house."
He added: "We are not concerned about platforms coming into our space."
Hogarth said there was a "consistent" trend towards advisers outsourcing their investment proposition, with many choosing to do so in order to focus on the advice part of the job.
"We are not that bothered where the business comes from, we will work with all the best platforms," he said.
Justine Randall, chief commercial officer at Tatton, said it was a natural move for platforms to start offering model portfolio services.
However, she warned of conflicts with independence if all services were offered through one provider.
Randall added: "I don't think the regulator wants it either, it means there isn't as much transparency.
"The key thing is to have one thing. We want to be the best performer and to be delivering the best service."
Tatton sees itself as a specialist in its field, which it believes has contributed to its recent growth.
The DFM was set up in 2013, reaching £1bn of assets under management in its first year. Some 10 years on, AUM stood at £17.5bn in June 2024.
Tatton's results for the year ended March 31 2024 showed the number of IFA firms it works with increased by 12.2 per cent to reach 975, compared to the previous year.
Hogarth at the time put this down to "consistency of the service standards, price, and investment returns" and the notion that it the firm has been "an MPS specialist from day one".
"Firms tell us every single day what they want and what they don't want," added Randall.
tara.o'connor@ft.com
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