Hargreaves Lansdown to meet its match? Newcomer makes bold claim to dominate UK market

A tall claim indeed, however it would be good to see more FX brokerages going in this direction and diversifying their ranges toward platform development for retail managed funds, especially during this time of high market volatility and low interest rates.

A few years ago, I compared Saxo Bank’s OpenAPI solution with the all-encompassing Vantage system developed by Hargreaves Lansdown.

This comparison was made in the presence of Saxo Bank CEO Kim Fournais shortly after the development of the extremely innovative solution, at which time Mr Fournais said “I would of course love to be compared to Hargreaves Lansdown” citing them as a large heavyweight within the retail electronic financial services industry.

Perhaps the differentiating factor between other leading FX, CFD and retail electronic investment firms and Hargreaves Lansdown is that Hargreaves Lansdown has risen to become a huge, £6 billion company whilst concentrating solely on a UK-based retail client base.

That is something of a feat, considering that whilst astute leaders such as Mr Fournais may revere Hargreaves Lansdown as a giant, his own company has gained huge international presence and tailored its technology to specific market preferences, especially in the notoriously non-western market aligned Asia Pacific region, with great success.

Either way, the titans that exist in our sector are somewhat overshadowed by the magnitude of Hargreaves Lansdown, whose retail business dates back to 1982 when it was a simple insurance brokerage, evolving into today’s multi-faceted electronic financial services firm with which its clients can operate everything from a CFD trading account, to pensions and ISAs and fund investments through one platform.

Surely if an unknown upstart appeared and made a bold statement alluding to being able to rival Hargreaves Lansdown, whose CFD and FX division HL Markets is a white label of IG Group, and whose CEO is former IG Group executive Chris Hill, a degree of skepticism would be justified?

Well, today this has happened, and the executive in question means business.

Felicia Hjertman, who co-managed the Baillie Gifford Japanese Smaller Companies fund until May 2019, plans to launch the business in early 2021, and it will take the form of an electronic investment platform for which she has raised £1 million to develop and provide to retail investors.

The new platform is intended to aggregate a selection of best-in-class funds to make inexperienced or cautious customers’ decisions easier.

33 year old Ms Hjertman today explained “It’s not a fun experience to invest at the moment. It’s hard to make informed decisions. We’re trying to take out the jargon and give more clarity.”

As far as the £1 million investment is concerned, backers include Techstart Ventures, retired Baillie Gifford fund managers and Schroders’ Nick Kirrage.

Indeed, this is a bold move, and it is certainly the case that more retail hedge funds are needed than outright spot FX brokerages in the global retail sector, however this is a relatively small investment with which to take on a huge firm with a 85% market share.

It would, however, be good to see more brokerages going in this direction and diversifying their ranges toward platform development for retail managed funds, especially during this time of high market volatility and low interest rates.

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