MiFID II Cost analysis available in Defaqto Engage

The independent financial information business, Defaqto has extended the capability of its end-to-end financial planning software with the addition of in-depth MiFID II portfolio cost analysis functionality.

Since 2018, MiFID II target market and cost data has been available within Engage’s investment workflows, allowing users to filter and compare funds on MiFID II costs. In a bid to further help advisers meet regulatory requirements, Defaqto’s latest release of its Engage software now includes a complete breakdown of MiFID II costs within its portfolio builder.

As well as being able to establish if a portfolio/fund(s) matches the client’s agreed risk level, users will be able to view a full MiFID II compliant cost breakdown based on the value of their client’s investment.

Users can now view:

• One-off costs – maximum costs incurred when entering or exiting the fund e.g. charge maximum entry cost, acquired maximum exit fee and the maximum cost acquired.
• Ongoing costs – the annual management charge and other fund expenses e.g. custodian fees, audit fees, legal fees, marketing distribution and costs of underlying investments.
• Transaction costs – costs incurred when buying or selling underlying investments. Includes both explicit costs e.g. dealing commission and implicit costs such as slippage.
• Incidental Costs – The impact of any performance fee.

Paul Dagley-Morris, Chief Technology Officer at Defaqto comments: “Compliance and regulatory change will continue to be a challenge in financial advice, as such we review and update our software solutions regularly. At Defaqto, we want to ensure that we make it as easy and efficient as possible for our users to ensure they’re always compliant.

“This latest update arms advisers with access to even more information to further assure compliance. Whether an adviser is recommending a new portfolio or reviewing a client’s existing investment, Defaqto Engage users can now see a full breakdown of MiFID II Costs.”