Investment Fund Charges

Investment Fund Charges – The Financial Conduct Authority (FCA) has issued a report recently into the charges made by Investment Funds.

The FCA believes that investors should pay a single charge and that this should include all the transactional and third party costs, that are normally added to the fund management charge.

Passive Fund charges have fallen steadily over the last 10 years but active fund charges have remained high in comparison.

The FCA’s view is that actively managed funds underperform their benchmarks and that because of the high charges imposed means that investors are losing money.

We strongly support the FCA’s stance but wonder why it has taken them so long to expose the fund charge scandal, when it has been obvious for many years that this is a huge problem.

In our opinion it is wrong to categorically denounce active fund management as there a select few that consistently perform above benchmarks. The problem is that many so called “active” funds are not selecting their funds out of conviction but are really index huggers, who are charging high fees for doing nothing.  

Ray Best is a resilient Financial Planner with a unique approach to investment planning, his work ethic has propelled him from humble beginnings to be voted as a top UK Financial Planner by Vouched For (as published in the Sunday Times). These days he works with families with large investment portfolios or big inheritance tax liabilities, the first step, is to book a Discovery Meeting HERE.

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