Are You Paying Too Much for Funds?

The cost of investing as measured by the annual management charge has fallen significantly over the past two years. But other more opaque costs have rocketed

Emma Wall 15 June, 2015 | 11:32AM

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Tens of thousands of investors are paying excessive fees for fund management. Headline rates may look like they’ve come down – allowing asset managers to brag about reduced costs – but delve at little deeper and you’ll find that the cost of investment has risen significantly for many over the past two years.

Regulation introduced in January 2013 was designed to help investors understand exactly what they were paying for. The Retail Distribution Review stopped asset managers paying advisers commission, and a new clean share class was introduced for fund investors to access the underlying holdings without the additional cost of lining the advisers’ pocket.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Invesco Income UK Inc1,077.48 GBP-0.57
JOHCM UK Opportunities A GBP Inc1.92 GBP-0.92
LF Woodford Equity Income A Sterling Acc4.72 GBP-39.31
Liontrust Macro UK Growth R Acc261.93 GBP-0.86
Schroder Recovery A Acc157.51 GBP-0.56

About Author

Emma Wall  is former Senior International Editor for Morningstar

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