With only six months before MiFID II rules come into force, 34% of alternative asset managers are still undecided on how to pay for securities research, according to a survey published today.
The Alternative Investment Management Association (Aima) found that, of the firms that have decided, 80% plan to charge investors and the remaining 20% intend to pay out of their own pockets.
MiFID II capital market reforms mean fund managers will have to ask clients for permission to continue to charge them for stock and bond research that fund firms often receive from the brokers they trade with.
Among other survey findings is that 75% of firms plan to self-report trades to their regulator under a MiFID II requirement for trade reporting.
Yet 50% of the more than 50 firms surveyed intend to delegate some of the reporting responsibility to one or more brokers, which indicates that some investment management groups will not limit themselves to a single reporting mechanism.
When publishing details of executed trades to the market – which helps set market prices – 33% of alternative asset managers plan to self-report, while the remainder plan to have brokers report their trades.
Aima chief executive Jack Inglis said: “This survey shows not only that a substantial amount of uncertainty remains but also that the industry is working hard to meet the January 2018 deadline.
“Alternative asset managers face further increases in compliance costs and we will be working hard with members and regulators to ensure concerns are addressed, and avoid any fallout in six months’ time.”
Earlier this week asset manager Kempen Capital Management became the latest firm to say it would from January pay for broker research out of its own pocket.
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