How severely will MiFID II hit Europe's advisers?

Mario Mantrisi, chief strategy and research officer at data management group KNEIP, explains how MiFID II could eventually price advisers out of the market, while investors could end up paying more for managers with sophisticated research capabilities.

The ban on inducements in the latest version of MiFID II could cause significant issues for financial advisers, as they will no longer be able to receive commission via third parties, resulting in the loss of a key revenue stream and additional non-monetary benefits such as free investment research. This raises fundamental questions regarding how the industry could survive if the proposed clause of MiFID II is approved, as it goes against the regulator’s ambition of creating a ‘level playing field’ at product level. Increased costs Although, overall, the MiFID II directive is a welc...