View more on these topics

Smaller funds hit by Cofunds’ rise in charges

Cofunds is to increase its charges for fund groups, with smaller funds set to be hit hardest.

Fidelity has also made changes to its charging structure, with fund firms’ annual fees linked to service levels and a new corporate action charge added.

From January, Cofunds will introduce a new fee structure, with all groups paying more for funds on the platform, although smaller firms will be worst affected.

Cofunds says this is the first fee rise since it was set up in 2001 and that the pricing structure will not be changed for three years.

Under the existing annual fee structure, firms are charged a similar amount regardless of asset size and sales. The new tariff takes both into account, so smaller funds will be hit hardest.

The annual price will be calculated from a company’s back book of business on the platform as of December 31 and new sales starting from January 1.

Funds will be placed into one of four pricing tiers, dep­ending on level of sales, with higher sales attracting lower additional percentage fees.

The highest add-on to the annual fee is five basis points. Cofunds refuses to reveal the lowest tier charge but denies there will be a zero level for the biggest and most popular sellers.

Fidelity FundsNetwork is linking annual fees to service levels to encourage groups to provide up-to-date information, such as fund prices. It is also introducing a corporate action charge for activity such as fund mergers, name or AMC changes. It estimates that over 1,000 take place every year. Cofunds already includes this in its tariff.

Skerritt Consultants head of investments Andrew Merricks says: “You would expect these charges to be passed on to the client at some point.”

T Bailey fund manager Jason Britton says: “If platform pricing were to move to a basis that adversely affected boutique fund groups, that could cause a problem for advisers.”


Skandia wants to know how RDR will help re-reg

Skandia has called for clarity on how retail distribution review proposals will allow re-registration of assets.Head of proposition marketing Peter Jordan says currently this is a no-cost activity because fund rebates and trail comm- ission cover the costs of the platform and adviser but the RDR is looking to ban both rebates and commission. He […]

FSCS compensation payments skyrocket

The Financial Services Compensation Scheme paid out £20.9bn in compensation payments in 2008/09, up from £82.93m in 2007/08, mainly attributed to the failure of five banks.

The changing world of professional connections

The Legal Services Act of 2007, which opened up the legal market to competition, has put the cat among the professional pigeons. In the words of a 2015 Law Society report on what the legal profession is likely to look like in five years’ time: “Business as usual is not an option for many, if […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm