Van Eyk - dealer groups' house of choice

Van Eyk Research was the most prominent gatekeeper of approved product lists (APLs) for the 20 largest dealer groups in Australia over the year to March 31, 2009. And while fund managers may not rate them as their preferred researcher, they acknowledge the value of a van Eyk rating.

While managers consistently rated van Eyk in the top three or four in a number of categories in Money Management’s 2009 Rate the Raters survey, the researcher’s standing in the dealer group universe has made them the house of choice for product ratings (tying with Aviva Research, which did not garner a significant response on its processes elsewhere). Not rated the preferred research house overall, fund managers still sought to have multiple products rated by van Eyk.

The results from both the dealer group data and Money Management’s survey highlighted disparate research house sentiment between fund managers and dealer groups, but it was clear that managers will take their products to houses with the most dealer group clout in order to secure a spot on APLs.

“We’re a significant gatekeeper, and because of that, people have to deal with us. And we treat that pretty seriously,” said Mark Thomas, director, van Eyk Research.

Thomas said fund managers see them as tougher than other research houses, but also fairer, noting that because the firm owns the intellectual property of the report, it is seen as “far less malleable”.

“We have no vested interest in the report other than it being the right call for our clients.”

He also pointed to van Eyk’s sector approach. “We do everything in relativity. We don’t do one-off reviews,” he said.

“Our clients at times will take lesser or greater notice of what we say,” Thomas added, but he noted the firm’s strong track record in avoiding disasters for clients because of its exhaustive process.

“We’ve missed out on a lot of things that have blown up and clients have appreciated that.”

Van Eyk, which does not accept fees and has previously been the subject of some controversy for its approach to rating products, was distinguished by fund managers for the considerable amount of time representatives spent with them.Thomas said van Eyk spent three months overseas last year for their ratings process, an unusual amount of time for a research house, and a costly practice.

Elsewhere, Lonsec remained the preferred research house among fund managers when taking overall results into consideration, and is the second most used research house among the top dealer groups (based on funds under advice).

For full survey results, see this week’s edition of Money Management.