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Published: 2018

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ISBN-13: 9789279667381

The general objective of the Study is to provide facts and figures on the current features and functioning of European markets for retail investment products, analysing specifically: - The supply of retail investment products through various distribution channels; - The access to financial advice by retail investors and related risks and benefits; - The impact of on-line distribution on the retail investment offering, notably on the breadth and terms of the offer, and on investor protection; and - The risks and benefits of new distribution models developed by FinTech companies. The Study covers 15 Member States chosen based on market size, date of integration into the European Union (EU), and the variety of specific policy frameworks in place: Belgium, Czech Republic, Denmark, Estonia, France, Germany, Italy, Luxembourg, the Netherlands, Poland, Portugal, Romania, Spain, Sweden and the United Kingdom (UK). The Study covers different types of investment advice: independent advice (e.g. through an Independent Financial Advisor (IFA) in a country with a ban on inducements), non-independent advice (e.g. through an advisor of a bank or insurer) as well as robo-advice (i.e. through an automated web-based platform). Investment products in scope of the Study are investment funds, listed bonds and equities, life insurance products with investment components and pension products. The tender requirements were posing specific methodological challenges as this study had to cover different types of investments products that fall under different regulations. We were not able to identify a suitable existing methodology which would set a common framework for all types of products and related regulations across the countries in scope. As a result, we needed to develop a methodology specifically for this project that would allow for a coherent study of the distribution of different types of investment products to retail investors. A major element of the methodology was the application of two data collection methods that explicitly mimicked the behavior of a financially less sophisticated retail investor seeking for information and advice on investment products. As part of this methodology, we searched for information on investment products on the webpages of the largest distributors in each country in scope of the study and we conducted over 500 mystery shops at banks, insurance companies, independent financial advisors (IFAs) and robo-advisors across 10 out of 15 Member States in scope. Through this, we were able to collect information on the types of products actively proposed to retail investors and to assess how general suitability of the proposed investment products was established. The data collection for this project has been performed over the course of 2017, before the entry into force of several regulatory changes that are likely to impact the market.