The regulator is forcing asset management firms to detail total expense ratios in the latest move to highlight investment product costs.
Haynes says constant emphasis on fund pricing could stop consumers looking at fund performance and suitability.
He says he applauds the rules that set out a simplified prospectus for implementing European requirements on product information but wants to see increased emphasis on suitability.
The FSA’s simplification paper, released this week, requires firms to show their total expense ratio, setting out fund costs and charges.
It also requires information on portfolio turnover rate to reflect the volume of dealing within the fund and the historic performance showing annual returns over 10 years.
Haynes says: “I do not know how useful people will find portfolio turnover rate and, of course, past performance data should be treated carefully because it does not mean that a fund will perform the same way in the future.
“There is a danger that if consumers worry too much about costs of products that they will stop looking for suitability. This information will be useful for fund of funds and manager of manager and within a sector. We do need to focus on total returns which is with costs taken into account.”
FSA director of retail policy and asset management sector leader Dan Waters says the new rules mean that all EU countries will have consistent information.
He says: “We propose to retain our existing approach to providing customer-friendly product information such as question-and-answer formats because we know from research that consumers find this style of presentation particularly helpful.”