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Fidelity reverses plans to charge clients for research

Money-Cash-Coins-GBP-Pounds-UK-700x450.jpgFidelity International has reversed plans to charge for research under Mifid II after feedback from clients.

The £239bn asset manager revealed it planned to implement a Research Payment Account approach as part of its overhaul of fees, announced in October, when it revealed it was adopting a ‘variable management fee’ model.

The RPA approach involves paying for external research via a budget collected through a research charge to investors.

Fidelity CIO for equities Paras Anand says they initially adopted that approach so that clients were treated equally regardless of whether they fell under Mifid II regulations or not.

But he says “overwhelming” industry consensus has been to absorb research costs, meaning Fidelity investors would face “disproportionate operational and reporting consequences”.

He says combined with the headline reduction in the baseline annual management fee of 0.10 per cent through the variable management fee, Fidelity’s decision to absorb research costs makes it more competitive.

He says: “[The variable management fee] represents an alternative to the flat rate charging structures which dominate the industry, and forms part of Fidelity International’s response to the broader regulatory environment and the debate within the industry around the value of active fund management.”


Fidelity defends 2% outperformance ceiling on new fees model

Fidelity International has defended its 2 per cent ceiling for outperformance in its new performance fee charging model, arguing it does not encourage index hugging and instead represents a material deviation from the benchmark. Fidelity yesterday revealed the details of its variable management fee model, a typeof fulcrum fee, which it first revealed it was adopting […]


Fidelity unveils details of new performance fee model

Fidelity International has published details on its “truly innovative” performance fee structure it recently announced in a major shake-up move. In October, Fidelity said it will introduce a fulcrum fee whereby the manager will charge a higher fee when it delivers outperformance net of fees, but will be lower if performance meets or is below […]

Paras Anand

Fidelity: Why we introduced performance fees

We believe that reducing our headline charge for asset management coupled with incorporating a new variable element into our management fee best supports our ability to deliver strong, fundamental research-based active management, while firmly aligning our clients’ interests. Our new charging model is a solid response to the criticisms that have been levelled at the […]


Sipp claims against Berkeley Burke could top 1,000

Lawyers who represent investors against Berkeley Burke over allegations of mis-sold Sipps estimate more than 1,000 claims could be in the pipeline. The High Court has approved a group litigation order relating to claims against Berkeley Burke Sipp Administration, and those affected have until 23 July 2018 to register to join the group action. It […]


Preparing for the journey ahead

Simon Halifax – Senior Marketing Consultant  Life’s unpredictable as no one really knows what the future will hold. The reality is that there’s likely to be a few surprises or bumps in the road along the way on our journey of life These ‘bumps’ aren’t usually positive, so we try not to think about them and […]


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