The following describes this full client focussed research process for investment bonds and includes some insight into typical research conducted based on our study from 2009. The investment bonds are located under the ‘investment’ tab from the home page of Synaptic Product Research. There are several different types of bond available for research including unit linked, distribution, conventional and unitised with profit bonds. You can right click over the different product titles to view the definitions. In this example we are demonstrating how to research protected benefit bonds since our 2009 study suggests that there has been a significant increase in the volume of research conducted for this bond type compared to the previous year.

Here’s how simple it is:

Fig 1 – Investment tab with protected benefits selected

Log in to Synaptic Product Research, select the investment tab, then select ‘protected benefits’ from under the investment bond heading. The system will take you to the ‘client entry’ screen where you can either load the details for clients (if research has been conducted for them previously) or enter details for new clients along with the investment amount.

Fig 2 – Client screen contribution for £50.5K

It’s worth entering the client details at this point as this information will often be used to start the product filtering process and will be used in the production of a report once you have concluded the research. Our 2009 study highlighted that the average case size for protected benefits is for £50,500.

Click on ‘start research’ to move to the filtering screens (the default is the features tab). At this point there are a host of different product features that can be used to apply simple tick box filtering to eliminate products (filtering out all the bonds that are not in line with client requirements).

Fig 3 – Features screen (ref to Synopsis for popular features)

By right clicking on a feature you will be able to view the feature definition. Left clicking on the feature title (without ticking the box) will allow you to build those features into a data grid for comparison without eliminating contracts from the research process. Data grids can be saved separately as a PDF.

Features listed in bold have further sub features that are made available when the feature heading is ticked. Our 2009 study highlighted that death benefits, penalty free encashment, withdrawal options and free switches are some of the most important aspects being considered for protected benefits research. There are a number of guarantee related features available which should be considered carefully, to ensure that the product being recommended protects the aspects of real concern to your clients. You can also view the full details of the guarantees available from the conditions tab or the contract factsheets available.

Fig 4 – Sectors tab

Further filtering is available from the ‘sectors’ tab. At this stage you will be given a choice of using the Financial Express global classifications or the IMA/ABI/AIC sector schemes. In this example we have opted for the ABI sectors. Here you will be able to select sectors suitable for your clients’ attitude to risk and investment objective by ticking alongside the relevant sector. Any contracts not fulfilling the full sector selections would be eliminated. Again, definitions are available by right clicking on the sector title. Alternatively, you can left click the title to add the sector to the data grid without eliminating products from the research.

More filtering is available from the conditions, stats and PP (past performance) tabs so there are many ways to reduce the remaining products and arrive at a shortlist of only those that are suitable for your clients’ needs. You can see how many have been eliminated from the research process above the contract names in the grid.

At any time throughout the filtering process you can select the ‘audit trail’ button to assist in identifying and evidencing exactly where and why products have been eliminated from the research process (this can be saved separately as a PDF).

Fig 5 – Audit trail

Proceed to the ‘ranking’ section. This will allow you to rank the remaining products on one or more of the ranking options available. Within each you are able to set the level of importance as low, medium or high. The ranking options span across aspects that are contract specific (e.g. surrender values and fund link stats), fund specific (e.g. past performance of underlying funds) or company specific (e.g. the financial strength of the provider). Our 2009 study identified that the majority of advisers consider contract specific aspects to be of most importance when researching protected benefits, followed very closely by company specific aspects. Very little importance was shown towards fund specific aspects such as past performance for this product type.

Fig 6 – Ranking selections

Next click on ‘calculate’ to display the results of the ranking process. Synaptic Product Research will conduct a series of calculations based upon the selected ranking criteria and the importance level to sort the remaining products.

Fig 7 – Ranking results

Individual scores for each ranking option can be viewed by clicking on the appropriate coloured tab.

Fig 8 – Individual ranking item

You can now advance to the report selection page by clicking on the ‘report’ tab. Highlight your recommended product from the list and select your preferred report format (quick standard reports/product factsheets or full suitability report) to evidence the research and recommendation process.

Fig 9 – Highlighting a product for report purposes

Note: the product type, filtering features, sectors and, ranking options used in this example are based on those highlighted as the most typical from our study of adviser behaviour during 2009. All items selected in this example are for illustration purposes only and do not constitute professional advice. All data correct as at March 2010.

Source: Synaptic Product Research.