Initial reviews of the impact of depolarisation show unsurprisingly that there is little knowledge of the changes among the consumers for whom the whole process was designed.This was entirely predictable. The investing public, let alone a good number of advisers, are already struggling with the increasing array of products and terminologies which continue to appear, particularly since the introduction of Ucits III. What is of interest to them are solutions to their needs. Often, individuals fall victim to a plausible sales pitch so that the status disclosure regime passes many of them by. There is one aspect of disclosure which appears to be gathering a head of steam. The impact of charges in the form of the total expenses ratio does at least highlight a measure of annual costs and the turnover within a given fund. It is quite novel seeing this aspect of costs and charges featuring in advertising and marketing campaigns. The Ucits III legislation, which includes many potential hazards as well as opportunities, is now delivering the information on TERs to investors. The initial big product push appears aimed at the cash-plus style of investment as a result of the permitted use of a range of financial instruments. Admittedly, these focus on a headline benchmark return rather than focusing on expenses. At the same time as this is occurring, having established a foothold in the market, the selection of exchange traded funds available is increasing and thus providing a much wider selection of asset classes where the particular features are the spread of investment and low expenses. This form of investment could be seen more frequently as a portfolio planning tool used to establish core holdings, with specialist funds providing the balance to suit a particular investor’s risk profile. We are then possibly witnessing the start of a shift in investor attitudes, with a focus on cost/benefit moving much higher up the agenda. With the rapid escalation of Sipp business anticipated in the new year, much of which will need to be fee-based, and with a trend for advice being offered on some form of fee structure, it is these clients who will gain access to more finely costed investments. This is at odds with the fact that, despite management fees having recovered significantly with the general market recovery since 2003, a number of groups have taken the opportunity to increase their charges “to move more into line with their peer colleagues”. This aspect has not gone unnoticed by investors and does not sit well with them, particularly with the increasing number of fund manager changes, which remains unsettling for clients. They will vote with their feet if providers continue this trend. At the start of the venture capital trust season, it is not helpful that debate is focusing on the so-called sweet equity incentive being offered by certain fund management groups, thus dissuading some investors from taking advantage of some excellent investment opportunities for those who are attracted to this asset class. So while the disclosure regime appears to be an non-event in terms of consumer perception, if the knock-on effect really does create a greater understanding as to the cost of managing investments, legislation may over time have the effect of changing the landscape for fund managers who might find it increasingly difficult to charge ever increasing sums. Human nature dictates that there will always be a reaction when terms become unacceptable. Remember how tax planning became less of an issue when the top rate of income tax dropped down from an effective 75 per cent to 40 per cent? Across the Channel, the French government has realised, following a mass exodus of higher-rate taxpayers, that punitive charges are ultimately counter-productive. It does take time for a reaction to build up but is often difficult to reverse once momentum has been established. Investors are looking to achieve sensible returns for their monies and, with a belated awareness as to the impact of running costs, greater thought should perhaps be given to future product design or there is a risk that market share will be lost.