View more on these topics

JP Morgan pauses low-cost fund drive after ‘tiny’ inflows

JP Morgan says flows into its low-cost UK active index plus fund have been “tiny” and it has no plans to launch another low-cost fund until inflows improve.

The company converted the £64.3m UK active 350 fund into the low-cost fund on February 1, 2011 and it now stands at £70m. It has returned 4.5 per cent in the year to March 23, 1 per cent above the 3.5 per cent average for the UK all companies sector.

Head of UK retail Jasper Berens says: “Flows into the fund have been tiny but as a whole there have not been huge flows into UK equities and risk assets generally. I am very confident that flows will pick up as risk appetite returns to the market.”

Berens says he has delayed plans to develop more low-cost products in the European, US and global markets.

He says: “Once I can get some traction in UK equities, I can start thinking about other asset classes.”

In March 2011, Schroders launched its low-cost UK core fund which now has £40m in assets. Last August, it set up its low-cost dynamic multi-asset fund which has £9.4m in assets.

HSBC Global Asset Management launched three low-cost funds in October. Its world index cautious fund now has £7m in assets while the world index balanced and world index dynamic funds both have £6m in assets.

Page Russell director Tim Page says: “It is going to take some time for these products to take off because their target investors are already using passives.”

Recommended

More 2 Life increases maximum loan size and cuts rates

Equity release lender More 2 Life is increasing maximum loan sizes by a third and cutting rates as it moves to increased individual underwriting. Customers are now assessed for different levels of medical and lifestyle impairment with rates cut by 0.2 per cent and maximum loan-to-value deals increased by up to 11 per cent. Someone […]

Qrops must offer same deal for residents

HM Revenue & Customs has published new rules on Qrops which confirm that schemes must provide the same tax benefits to residents as non-residents. Final rules published by HMRC last week include req-uirements previously known as Condition 4, which mean Qrops providers must treat non-residents and residents of a jurisdiction in the same way for […]

Analysis: Insurers secure rethink on matching premium

Insurers have secured a last-ditch amendment to Solvency II rules which could prevent a 20 per cent drop in annuity rates, although concerns remain about its implementation. There has been concern that measures put forward by the European Parliament’s Econ committee would not contain reference to a so-called “matching premium”. The Association of British Insurers […]

Planning now for the residence nil-rate band

Graeme Robb, senior technical manager at Prudential, writes about the residence nil-rate band and the advice opportunities it presents for you when tax year-end planning with your clients. On our Planning Matters hub, we considered a widow, Margaret, and a married couple, John and Anne, for whom the residence nil-rate band (RNRB) is influencing planning […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment