SOLICITORS are carving out a significant piece of the fund management sector for themselves, threatening the market share of Independent Financial Advisers (IFAs).
Association of Solicitor Investment Managers figures show the funds administered by its 50 members have doubled from £1.5bn in 1995 to £2.39bn in the last three years.
With the typical management rate being around 1 per cent, the 50 firms have shared in a £23m windfall and are now being seen as a threat by IFAs.
John Ellis, the Life Insurance Association's public affairs director, says there is anecdotal evidence of increasing numbers of lawyers moving into the field.
He says: “We may be seeing the beginning of something big here. But I wonder how many solicitors will want to do this.”
The answer is plenty, if the Law Society has anything to do with it.
The society's investment business executive Alison Matthews says: “[It is] a good idea for solicitors to look at financial management to replace their traditional sources of work, if they do it properly.”
The founder of the Association of Solicitor Investment Managers, Heather Martin, says many lawyers “find a synergy” between their work on clients' trusts and estates and the management of their funds.
“For the right sort of firm, it's a very good area because it isn't subject to cyclical ups and downs.”
The typical solicitor fund manager has been “big, provincial high street firms”. But now a growing number of London firms are getting involved.