Occasional Paper No. 30: Best buys and own brands: investment platforms’ recommendations of funds

In this paper, we examine the drivers, impact, and performance of investment platforms’ best buy lists.

Occasional Paper No. 30 (PDF)

We have published this Occasional Paper alongside an Insight article - Walking the aisles of the UK’s fund supermarkets.

Find out more about Occasional Papers and read our disclaimer.


Investment platforms, also known as ‘fund supermarkets’, are important intermediaries in fund investment in the UK. These web-based services allow retail investors to research, buy and sell, manage, and monitor their holdings in funds. Many of these platforms also make their own fund picks in the form of ‘best buy lists’.

Historically platforms have been exposed to potential conflicts of interest when creating these lists. First, some platforms are affiliated with funds, such that their ‘own brands’ are also offered through that supermarket. Second, until a regulatory change which came into full effect in 2016, platforms in the U.K. could receive from funds a share of the fee revenue (commission) on investments which were channeled through the platform.

Using data from leading platforms in the U.K., we examine the drivers, impact, and performance of these best buy lists. We also assess the effect on drivers, fund flows, and performance of the two potential sources of conflicts of interest mentioned above, namely affiliation and revenue-sharing.

We find that best buy lists favour funds with a low cost to investors, but also favour affiliated funds and those which pay greater commission rates to platforms. Best buy lists affect flows considerably, although investors appear to discount ‘recommendations’ of affiliated funds. Best buy list funds outperform non-best buy list funds overall, but affiliated funds included in best buy lists on average do not. We also find that best buy list funds which pay greater commission rates to platforms do not perform worse than others.


Gordon Cookson, Tim Jenkinson, Howard Jones, and Jose Vicente Martinez.

Gordon Cookson is with the U.K. Financial Conduct Authority, Tim Jenkinson and Howard Jones are with the Saïd Business School, University of Oxford, and Jose Vicente Martinez is with the University of Connecticut.


Occasional Papers contribute to the work of the FCA by providing rigorous research results and stimulating debate. While they may not necessarily represent the position of the FCA, they are one source of evidence that the FCA may use while discharging its functions and to inform its views. The FCA endeavours to ensure that research outputs are correct, through checks including independent referee reports, but the nature of such research and choice of research methods is a matter for the authors using their expert judgement. To the extent that Occasional Papers contain any errors or omissions, they should be attributed to the individual authors, rather than to the FCA.