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Expense ratios on rise for investment trusts

Total expense ratios on investment trusts have risen in the past decade despite increased scrutiny of the effect of fees on returns, says investment trust support firm Frostrow Capital.

The firm’s figures show the average investment trust TER has risen from 0.91 per cent to 1.09 per cent.

TERs show the extent to which fees and costs on a fund, including the manager’s fees and trading costs, detract from performance each year as a percentage of total assets under management.

Hargreaves Lansdown senior analyst Meera Patel says: “A lot of the popular funds nowadays tend to be more commodity and emerging market-based. Managers have told us these areas are more expensive to trade in.”

The report shows that funds have outperformed cash in the past decade, with open-ended funds delivering 29 per cent growth and investment trusts adding 54 per cent while cash delivered 27 per cent.


Hawksmoor counters cautious claims

Multi-manager Hawksmoor believes it is difficult, if not impossible, to legislate that a fund is being managed cautiously. Its comments follow criticism of some funds for exceeding the IMA cautious managed sector limit for equity exposure. The firm says cautious means different things to different people and it can be difficult to classify some investments […]

Bonds in 2017: Stick or twist?

Royal London Asset Management Bond Fund Managers Paola Binns and Craig Inches look at why short duration could be a key tactic for fixed income investors during 2017. Read the full article here The value of investments and the income from them is not guaranteed and may go down as well as up and investors […]


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