For Greater Fund Charge Transparency

NOTE: This post is more than 12 months old, and the information contained within may no longer be accurate.

News this week was that Fidelity Funds Network have been one of the first fund management groups to release details on the payments it receives from other fund managers (Source: Money Marketing). Whilst they’re to be commended on their relative transparency they’ve still missed the mark for a couple of reasons:

  • The “Fee Transparency” document does not show adviser remuneration (commission), which is often between ¼% to ¾% per annum (with ½% being ‘normal’) but can vary
  • The “Fee Transparency” document does not show other manager expenses, for example dealing fees, accounting costs and other miscellaneous charges incurred in the day-to-day running of the fund. Often these charges are modest (less than 10p in £100), but in some cases they can be much greater. At best, these figures are only ever estimates.
  • The FSA have planned to put in place steps to force fund platforms to ban rebates altogether, but have caved after significant pressure from platforms and fund supermarkets

It is this firm’s view that all remuneration should be transparent, we are rare as we endeavour to; rebate all our commissions for client benefit, disclose fund management costs, including platform charges and an estimate of manager expenses.

This is not always possible as some platforms seek to obfuscate their charges, and we would welcome legislation to level the playing field.

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26 Jan 2024

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