Many a schoolboy has felt puzzled by the financial world, a universe so seemingly arcane that often youngsters are left baffled by what appears to be a jargon-filled, esoteric industry.
Luckily, the young Mark Atherton, now director of EFG Harris Allday’s Birmingham office, had the alacrity to pen letters to leading newspaper editors asking for some help.
‘I started to read the financial press and decided it was fascinating, but I couldn’t understand some of it. I wrote to the editors of the Financial Times and The Times and asked them for some guidance as to how to read it,’ he remembers.
‘And they all wrote back with personal letters in those days. I decided this was a career for me.’
Good thing too, as via stints at Albert E Sharp, Quilter and Rathbones, Atherton has risen to prominence in the Midlands investment scene and has been tasked by EFG Harris Allday to develop its adviser-focused offering.
The office is located in what was once the Birmingham Stock Exchange, and while one would expect the building to audibly groan under the weight of history, actually its interior is a pleasant mix of modern office space and grand, portrait-lined committee rooms.
Atherton is relaxed and likeable, sure of what he knows but free of arrogance, and appears as happy showing off the 100-year-old bric-a-brac in the back rooms as he is talking business.
Aside from the simple fact of his long experience partnering with advisers, Atherton chooses to work with IFAs because he believes in specialisation and has a wariness towards a jack-of-all-trades mentality.
‘I choose to take the route that I am a specialist, I want to concentrate on managing money,’ he explains.
‘The reason I work with IFAs is that I believe that we, as stockbrokers, clearly are not qualified nor regulated to give financial advice – unless you pass the exams to do so, but most of us don’t.
‘And to really know your client properly you almost need a specialist in that area. An IFA is a specialist.
'That’s what they do, they look at a person holistically and say “this is your current situation, this is your tax situation and this is what we suggest, holistically speaking. And by the way, your Sipp needs to be managed by a discretionary fund manager”.
‘Of course, I am aware of the various tax advantages of Sipps. But to know the exact detail and then to get it approved, that’s an entirely different ball game. I see it as a different job; it’s a specialisation in its own right.’
When Atherton joined EFG Harris Allday in 2010 he had ‘almost a blank canvas’, and has since put in place a number of measures to make the offering accessible to IFAs.
‘We have had to do a lot of things that are new to Harris Allday simply because they had not gone out and focused on the adviser-led business before,’ he said. Now, the bank has a recently launched model portfolio service on leading platforms Novia and , and is on ‘almost all’ adviser panels.
His colleague Samantha Whitehead – formally a personal assistant but clearly an important asset in Atherton’s working life – has had a hand in revamping the company website and helped develop a suite of client literature.
‘She worked with me at Quilter and she was extremely good, she got on with my clients and IFAs,’ he said.
With the fruit of two years’ work now in place, Atherton is confident he has an attractive service for IFAs.
‘Now when we go out to see IFAs we can say “yes” to many of the questions they ask us. They would have very few reasons not to deal with us and we ought to be the preferred choice,’ he said. ‘The hope is we can expand the business and I don’t really see a ceiling.’
Despite his ambitions, he says he does not work to targets, instead preferring to allow the business to grow on its own terms.
‘The business will develop naturally, as and when I develop IFA and accountant connections,’ he says.
‘I’m very happy with the service levels that we have developed. We have the bespoke portfolio service and the model portfolio service – there’s no gap in our offering.
‘Ultimately what I’m trying to offer is something that is hugely retail distribution review (RDR) compliant insofar as making sure that there should be similarity between a £2 million client and a £200,000 client, they shouldn’t be different. Why should they? If the mandate has the same consistent outcomes – and I don’t like the phrase, but it seems to have prevailed – that is achievable.’
Clearly Atherton has relished the opportunities he has had at EFG Harris Allday: ‘With the freedoms and the support within the firm, I have been able to develop things and change things as I see fit,’ he said.
‘I have generated new books of business from scratch, having not actually inherited business from anybody ever. And I did that at Quilter, and I did it at Rathbones and I know I can do it again. The opportunity here is very exciting.’
This extends to building relationships with ‘a lot’ of IFAs based in Northern Ireland, an achievement he shrugs off: ‘It’s a flight. It’s cheaper than going to London. It’s an absolute no brainer. I probably go there every other week.’
While Atherton has beavered away preparing for the RDR, he does recognise there may be limitations for some clients.
‘One of the possible outcomes of RDR could be that clients who are less wealthy are disadvantaged purely because the IFA community simply can’t make a living out of the smaller clients. And that is one of the very unfortunate sides of this regulation.’
Like many wealth managers, he shares concerns about the increasing rise in regulatory costs, and agrees that the industry will have to respond and evolve in future.
‘I think the cost of regulation is going to be prohibitive for many clients because the cost will have to be passed on somehow. And that goes not just for investment management but for financial advice in the broader sense. And it will affect our industry.’
His own discretionary portfolios are largely populated with collectivised investments, and he prefers to avoid direct equities, owing to the volatility that markets have seen over the last decade.
‘I would probably say they are too risky for most clients, too volatile. And if they follow the industry standard models they will have undoubtedly been rather volatile over the last 12 years.’
Favourite fund managers include M&G’s Richard Woolnough, who is a ‘great manager’, and [Citywire AA-rated] Dickie Hodges from Legal & General. ‘His dynamic bond fund has historically done very well, but he crashed his motorbike recently.’
The popular Findlay Park funds are also on Atherton’s watch list, but he advises: ‘Go for the dollar [share class] – I think it’s got a better chance of outperforming the GBP.’
For IFA clients with other preferences, Atherton passes the business on to his colleagues. ‘As a company we can offer the whole thing, we do have portfolios that are just equities or just bonds.’
Atherton’s investment experience has been gleaned from a number of firms. He spent the first five years of his career working at London stockbrokers during the hubbub of the Big Bang. ‘It was just post-Big Bang so there were a massive amount of changes going on in the industry. It was testing, but I was in my 20s so it was quite good fun,’ he recalls.
‘It was a magnificent foundation for my work ethos and set the ground rules for the rest of my career.’
While London life was stimulating, Atherton decided to move back to his native Midlands and landed a job at stockbroker Albert E Sharp, the firm that once formed the backbone of the region’s investment industry.
He moved to Quilter and during an almost nine-year long stint rose to become associate director, before his position as a one of the region’s leading managers was solidified when he was given the chance to open Rathbone’s first Birmingham branch alongside Daniel Faulkner.
While Atherton has worked at a raft of firms, it’s clear he’s found a home at EFG Harris Allday:
‘I really enjoy both aspects of what I do, which is managing money and going to see IFAs. I find the investment side fascinating, I find the people side fascinating.’