The trade press is filled with click bait headlines about the FCA’s review of model portfolio services. The truth is, the MPS review is being welcomed by most DFMs and is recognition that this is an important part of the retail wealth market.

NextWealth’s most recent report sized the market for discretionary MPS at £208bn. Total market assets are up 32% for the year to the end of Q1 2026. Asset growth in discretionary MPS continues to far outpace platform asset growth and financial market’s growth (we compared growth to the MSCI World Index). These solutions are taking a growing share of wallet from advisers and their clients. Quilter Wealth Select and Tatton continue to top the league table but healthy growth was posted by most of the 59 firms in our report.

There also remains plenty of room to grow. Would it surprise you to find out that only one fifth of platforms assets are in discretionary MPS?

This market is large and growing, it is highly competitive, and propositions are differentiated. Given its size and importance, it warrants a look from the regulator. The MPS review isn’t a bad thing. It’s recognition that MPS is here to stay and is an important offering to clients of financial advice.

What is the regulator looking at? We understand that fees, co-manufacturing, conflicts of interest, governance and MPS versus unitised solutions are in the spotlight. DFMs tell us that the focus is squarely on customer outcomes. The focus is not on how parties across the chain work together but is squarely on whether these solutions are delivering good outcomes for clients.

At our recent DFM Council meeting, members agreed that it is critical to engage fully and transparently with the review. Most DFMs (77%) in our recent report said that they expect no impact from the review on their business. It is too early to be sure. Data requests are with firms now and depending on what comes back, the scope might expand.

We welcome this review. It is confirmation of what we already know. This is an important part of the market and deserves a look-in from the regulator.

Heather Hopkins, CEO & Founder, NextWealth

FAQ:

What is the FCA’s review of model portfolio services (MPS)?

The FCA’s review of model portfolio services (MPS) is examining whether these investment solutions deliver good outcomes for retail investors. Areas of focus include fees, governance, conflicts of interest, co-manufacturing arrangements, and how discretionary MPS compares with unitised investment solutions. The review reflects the growing importance of MPS within the UK wealth management market.

Why is the FCA reviewing the MPS market now?

The MPS market has experienced significant growth in recent years, with discretionary MPS assets reaching £208 billion by the end of Q1 2026. As model portfolio services become a larger part of the retail wealth market and account for an increasing share of adviser-managed assets, the FCA is reviewing the sector to ensure firms continue to deliver value and positive customer outcomes.

Will the FCA’s MPS review affect discretionary fund managers (DFMs)?

Most discretionary fund managers (DFMs) currently expect limited impact from the review. According to recent industry research, 77% of DFMs anticipate no significant changes to their business as a result of the FCA’s investigation. However, the final impact will depend on the findings of the regulator’s ongoing data collection and assessment process.

What does the future look like for model portfolio services in the UK?

The outlook for model portfolio services remains strong. Despite rapid growth, only around one-fifth of platform assets are currently invested in discretionary MPS, indicating substantial room for expansion. The FCA review is widely viewed as recognition that MPS has become a core component of the UK financial advice market and is likely to remain an important investment solution for advisers and their clients.