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Fidelity to pay renewal commission on Sicavs

Fidelity is to start paying renewal commission both on lump-sum investments and regular savings business into its Luxemburg-domiciled funds for the first time from this week.

From August 7, Fidelity will pay advisers 0.5 per cent trail commission on 27 of its Sicav funds, including its China focus and India focus funds, as well 16 of its other offshore funds which were recently given sterling share classes.

Fidelity head of IFA channel Peter Hicks says: “At Funds Network, we saw for a while how important it is to get recurring revenues into your business.

“It puts you on a stronger financial footing and the broker gets rewarded for servicing existing clients. A lot of advisers are looking to make the transition for their business towards recurring revenue. It is good for their business, good for ongoing service and is paid out of the annual management charge so there are no extra costs.

“Offshore funds are playing an increasing role in portfolio asset allocation, with more advisers using offshore funds as part of their regular fund universes.”

Chelsea Financial Services managing director Darius McDermott says: “In the past, Fidelity has often been seen as being aloof but this is good news. It is a step in the right direction for them in improving their relationship with advisers.”

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