Woodford Investment Management is to stop charging investors for the cost of research and will instead the pay the fees in-house.
The Sunday Times reports from this month the CF Woodford Equity Income fund will reduce its fees so that the fund management firm will meet the costs of research rather than the clients.
Research from Woodford Investment Management suggests in 2015 the total cost of investing in the fund was 0.84 per cent, of which 0.02 went on research.
Woodford Investment Management chief executive Craig Newman says: “Just as investors deserve to know where their money is invested, they also deserve to know how we have spent their money to make those investments.”
The FCA estimates £1.5bn was spent by brokers on research in 2012.
In November the regulator announced it was carrying out a market study into competition in asset management, looking at how fund groups compete to deliver value and whether they are motivated or able to control costs.