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Investors get charging deal as M&G switches funds to Oeics

M&G is to convert its unit trust range to Oeics in a move which will make

its entire fund range available on a dual charging basis.

The conversion, which is set for completion on Nov-ember 1, will offer

investors the choice of two different share classes on each of M&G&#39s

open-ended funds.

For investors who do not want to pay an initial charge, which varies

depending on the fund, the annual management fee will typically rise to 1.5

per cent from 1 per cent.

However, IFAs will still be paid front-end commission on no-load funds,

typically at 3 per cent.

M&G is also set to introduce free switching on all its funds, axing its

current 2.5 per cent charge for all transfers within the M&G fund range.

As with all Oeics, M&G&#39s funds will all be single priced, eliminating the

bid-offer spread, which the company says is confusing for investors.

The company will write to unitholders on September 25 to seek their

app-roval for the changes.

Managing director (UK retail) Phil Wagstaff says: “We wanted to bring nil

initial charge funds across our entire range. In 1994, M&G pioneered no

initial charge funds.

“Although the majority of people want nil initial charge funds, most IFAs

wanted the choice. We now offer both.”

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