According to market research firm ORC International, 45% of UK-based IFAs said they would not be placing investment trust business and just 36% of advisers said they would recommend them over open-ended funds.
Further, 18% were undecided, with ORC saying this suggested there was scope for new interest in the sector.
A spike in the sales of investment trusts was anticipated with the advent of the RDR, and its ban over commission payments, suggesting closed and open-ended funds would be more evenly pegged against one another.
But the research has suggested such expectations might have been premature.
The biannual survey of IFAs and DFMs revealed that 58% of DFMs said they would be placing investment trust business, in the next six months, 23% said they would not and 19% were undecided.
Good performance and value for money were cited as reasons for considering closed-ended products, whereas client suitability was given as a reason for rejecting them.
Hanya Dezyk, research director at ORC International, said: “Unsurprisingly, it looks as if most of the future demand for investment trusts will be via discretionary asset managers.
“There had been speculation that with the changes after the RDR, there would be more of a level playing field for investment trusts. However, for financial advisers it looks as if there are still too many issues associated with investment trust business. Nevertheless, the fact that a high proportion of advisers are still undecided shows there is still some scope for change down the line.”
