The changing nature of the asset management industry is a wonder to behold.

When I first started out, the main recommendation for investment was a managed bond. Partly because so many adviser firms were being set up by those who had worked in the insurance industry selling life bonds and also because they would pay 5%-plus commission.

At that time, unit trusts paid 3%. It wasn’t hard to see what was going to be sold the most.

The 5% withdrawal, often described as tax free, was another selling point. Do you remember the income surcharge investors had to pay for their dividends, too, again helping the sales of insurance bonds? And, of course, no regulation to begin with. What a cowboy’s charter.

It’s good to see how much has changed – mostly for the better. The Retail Distribution Review was a big change and Consumer Duty has signalled a turning point for old poor practices, too.

Meanwhile, the active management industry is now under the most pressure I have ever seen.

Active is caught between high costs of regulation and new business rapidly disappearing to the passive industry.

Looking at the top 20 best-selling funds from major platforms today, compared to only about five years ago, I am struck by just how many are passive funds – generally the majority.

Have investors suddenly discovered that these funds are much cheaper than active? Perhaps that is some of the story, but the biggest reason is surely that old chestnut – past performance.

Simply put, passive funds have slaughtered most active funds, especially over the last 15 years or so.

This wasn’t always the case. I remember at Hargreaves Lansdown looking at passive funds in the noughties and finding most were, at best, third quartile performers.

What changed? Falling prices, the rise of ETFs and the move to global funds rather than regional funds (although the latter is, of course, still well represented by passives) have all played a part.

Before the turn of the century, global funds hadn’t been big sellers. Portfolio managers usually preferred to do their own asset allocation through regional funds. The DIY investor was also more attracted to specific funds and the media tended to centre on regional funds where there was usually more of a story to write. Global seemed more of a backwater.

But there has been another factor at play. In some ways, we got an inkling of this in the late 1990s with the tech boom and bust, which really centred on the US.

From this first boom came many of the big US winners we see today. The top US stocks now not only dominate the S&P but the global indices, too, and the US weighting in the global index is now over 70%.

With such large index companies, it becomes very difficult for active managers to have any chance of outperforming.

The US has been the standout major market since the low point of the great recession in 2009. As it dominates global indices, is it surprising global index funds have become so popular? They are, in effect, quasi-US funds.

As such, the diversification argument for buying a global fund seems quite weak and may well come back to bite investors later. It is equally possible to argue that, should the US market catch a cold, the other markets will have pneumonia.

So, today, the investment world is dominated by two factors – passives and the US.

I vaguely seem to recall Sir John Templeton saying that, once a sure way of making money had been found in markets, it was only a matter of time before some kind of disaster struck.

Will the momentum style of passive investing be its downfall? Maybe. But at least no one will get the blame, as it can only reflect the market.

Will active rise to the challenge? No chance. It’s too fraught with regulatory and business risk to do anything much different to the index and, of course, we all know you can be wrong for a long time.

I suspect the party will continue for a bit longer. Plenty of cash remains on the sidelines and pessimism still abounds. For a sense of danger, I also think too many look to the US. China looks to be the most in trouble – but that’s for another time.

In the meantime, I expect to see huge consolidation in the active management industry.

Mark Dampier is an independent consultant and can be found tweeting at @MarkDampier

A HOSPITAL COOK won £25 million in the lottery, but only took home a fraction of the winnings due to a promise she’d made years previously.

Julie Amphlett was working at Nealth Port Talbot Hospital, Wales when she heard the news of her giant EuroMillions win in 2017.

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However, she had previously agreed to divide any winnings with five other people – meaning she only came away with just over £4.2 million.

The six women were part of a work syndicate called The Catering Girls – all colleagues at the hospital.

They had been playing the Euromillions for six years before their win.

Despite losing out on a large proportion of the jackpot, syndicate leader Julie was delighted with the result, as the six colleagues all quit their jobs and jetted off on a luxury holiday to Las Vegas.

Julie and fellow syndicate members Louise Ward and Sian Thomas reunited this week to celebrate 30 years of the National Lottery.

Along with other lottery winners, the women prepared a special lunch for guests at the Cegin Hedyn community café.

Julie said: “It’s great to be back in the kitchen with the girls, it takes us right back to those years we spent in the hospital kitchen before our incredible win.

“And it’s nice to be using our skills for such a deserving project.

“The idea that everyone, from all walks of life, can come together and share a meal is so important within the local community.”

The women prepared food and mocktails, and presented a gift and thank you note to those involved in the success of the café.

Since opening, Cegin Hedyn has served over 10,000 meals to the local community.

Dave and Sarah Williams, Wales’ most recent National Lottery millionaires, also joined The Catering Girls in the kitchen.

Dave said: “Since that incredible moment when our numbers came up I’ve pinched myself quite a bit, and today is no different.

“Firstly, it’s amazing to meet all these other lucky winners – I didn’t realise there were so many in Wales! – and it’s also been great to see where the Good Cause funding goes to, this project is doing some truly amazing things for the community in Carmarthen.

“Our lives have changed so much for the better since our winning moment.

“We moved into a new home where Trevor, our very boisterous dog, can finally wear himself out with his zoomies, and Sarah and I are taking things easy for a bit before we plan our next adventures, and if I know Sarah, that might well be deciding what pet will be joining our family next.”

The news comes as another lottery syndicate in Australia descended into a bitter feud.

Alan Way sought legal action against Mark Peter Bowling, 76, and Moya Posa, 89, over claims he was cut out of the syndicate’s massive £3 million winnings.

Professional Indemnity Insurance (PII) provider BareRock has launched a counselling and wellbeing support programme for its advice firm policyholders.

The programme aims to support the mental health and wellbeing of individuals within BareRock’s club member firms who are dealing with the strain of high-stress complaint situations, by covering the costs of professional counselling.

Under the new initiative, BareRock will fund up to 10 one-hour counselling sessions per claim, subject to a £2,000 cap, with no policy excess payable by the club member firm.

This is designed to help business owners, senior leaders and employees who often find themselves directly involved in managing complex and pressure-filled complaints while juggling multiple responsibilities in highly regulated businesses.

The initiative will be incorporated into BareRock’s offering at no extra cost during the last quarter of 2024.

It will be available to existing and new policyholders.

The news was announced on World Mental Health Day today (10 October).

BareRock CEO and founder Jonathan Newell said: “We are constantly seeking ways to enhance our offering and provide meaningful value to our club members where it’s needed most.

“By offering compassionate support on a human level, alongside technical and strategic assistance during complaint situations, we can help our club members better manage the emotional and mental toll of dealing with stressful complaint situations.

“This mental health and wellbeing support is a great demonstration of our commitment to our customers and to the FCA’s vulnerable customers guidance.”

BareRock’s counselling services aim to support individuals as they navigate the challenges of their roles.

The programme helps develop strategies for better stress management, work-life balance and mental-health prioritisation.

Corporate Personal Wellbeing (CPW) is BareRock’s preferred partner in delivering these professional counselling sessions.

THOUSANDS of households will soon receive letters confirming their entitlement to a £300 cash boost.

The Winter Fuel Payment is a state benefit paid once a year to pensioners to help cover the costs of heating during the colder months.

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It was avaible to everyone aged 66 and over but recent cuts made by Chancellor Rachel Reeve mean only those on means-tested benefits, such as Pension Credit, will now get the help.

How much you recieve also depends on what year you were born.

For example, if you live alone you will get £200 if you were born between September 23 1944 and September 22 1958.

But you will get £300 if you live alone and were born before 23 September 1944.

If you and your partner jointly claim any of the benefits, one of you will get a payment of either:

• £200 if one or both of you were born between September 23 1944 and September 22 1958
• £300 if one or both of you were born before September 23 1944

The Department for Work and Pensions (DWP) will begin sending letters to pensioners who quailfy for the payment in England, Wales and Northern Ireland. by the end of October.

For customers in Scotland the target date for issuing the letters will be in November.

All quailfying pensioners across the UK should recieve their payment of either £200 or £300 by November or December.

The money is paid automatically in your bank account.

If you do not get a letter or the money has not been paid into your account by January 29 2025 it is recomennded you get in contact with the Winter Fuel Payment Centre.

This is operated by the DWP and can reached on the telephone by calling 0800 731 0160.

You can also send a letter via the psot to Winter Fuel Payment Centre. Mail Handling Site A, Wolverhampton, WV98 1LR.

When you contact the payment centre, you’ll need to tell them your personal details like:

• Your name
• Your address
• Your date of birth
• Your National Insurance number

Who is eligble for the Winter Fuel Payment

You will receive the Winter Fuel Payment if you are aged 66 or above and on any of the following benefits.

• Pension Credit
• Universal Credit
• income-related Employment and Support Allowance (ESA)
• income-based Jobseeker’s Allowance (JSA)
• Income Support
• Child Tax Credit
• Working Tax Credit

You may also recieve the benefit if you are a UK pensioner who lives abroad.

A partner below the state pension age may also be eligible for the £300 payment if they live with a partner who is over state pension age and they jointly claim benefits.

It is worth noting that around 800,000 older ­people risk missing out on the £300 Winter Fuel Payment because they have not first registered for Pension Credit.

The benefit is a weekly payment from the government to those over the state pension age who have an income below a certain level.

If your claim is successful then the benefit will top up your income to £218.15 a week if you are single, or £11,343.80 a year.

It will also give you access to the Winter Fuel Payment.

You will need to have been claiming Pension Credit in the ‘qualifying week’ of September 16 to 22, 2024.

But claims can be backdated by three months meaning you have until December 21 to make a claim and still get the Winter Fuel Payment.

If you want to check your eligibility then it is worth checking out our article here.

You can also find free-to-use online benefits calculators to work out what you’re entitled to.

For example, Age UK has an online calculator which helps you work out what benefits you could be entitled to including the Winter Fuel Payment and Pension Credit.

According to the site it takes 10 minutes to complete and you will need the following information:

• Your savings
• Your income, including your partner’s if you have one
• Any benefits or pensions you’re already claiming, including anyone you’re living with.

The calculator is free to use and confidential.