8 out of 10 St. James’s Place funds have consistently underperformed

Yodelar’s St James Place review of 2021 says:

Poor Performance and high costs from St James’s Place
8 out of 10 SJP funds have consistently underperformed.
Over 50% of SJP funds rank in the worst 25% of their sector
72% of St James’s Place funds perform worse than the benchmark
St James’s Place admits two thirds of funds failing consumers.
Restricted advice model, clients limited by fund choice
SJP advisers are unable to advise investors on 99.3% of the investment market.
Exit penalties of up to 6% for the pension and bond products
Limited protection under the Government FSCS Scheme.

Why do investors accept these statistics?

The answer is simple.  SJP employs the best salespeople. They know investors tend to make investment decisions on gut feel. All SJP salespeople I have met come across as ‘nice’ people.  As such, it’s understandable why investors can ‘feel’ justified in employing SJP. Yet every investor when asked wants the best returns possible. Why wouldn’t you want that? But why do investors fail to secure the best options and instead make decisions based on ‘how they feel’?

There is a warning.

Warren Buffet once said about employing people. “We look for three things when we hire people. We look for intelligence, we look for initiative or energy, and we look for integrity. And if they don’t have the latter, the first two will kill you, because if you’re going to get someone without integrity, you want them lazy and dumb.”

My issue is simply when SJP salespeople know their performance is poor, they still sell it to people.

If SJP salespeople gave investors Yodelar report as impartial evidence, then investors have more information to decide.  And if every investor is fully cognizant of the information, both positive and negative, and they still wish to proceed with SJP, that’s fine, as the decision is made based on good information not on how the salesperson makes you feel.

Whilst SJP are singled out in the Yodelar report, they are not alone. There are many institutions that rely on salespeople to sell their funds. Every investor needs to find a way of balancing ‘how they feel’ together with some good research.

You then increase the chances of making a decision that is right for you.  After all, it’s your money, not theirs!

If you want to check out your portfolio, try out our Investment Audit. It’s applicable to ISAs, Pensions, Trusts, Offshore investments, and General investments.