Performance matters: Can the IMA solve fund charges conundrum?

Performance matters: Can the IMA solve fund charges conundrum?

clock

The Investment Management Association (IMA) is struggling to find a "perfect" solution to calculating fund performance following the shift to clean pricing, and may have to devise a completely new approach.

The trade body last year held back from releasing new recommendations about how it would calculate fund and IMA sector average returns, stating it wanted to wait for the release of clean and super clean preferentially priced share classes. As a result, all performance statistics are still based on bundled share class performance, with returns reported after the impact of an annual charge which is typically 1.5% per annum for an equity fund. Now, with commission and platform fees stripped out, the starting point for a clean share price is around 0.75%, but the IMA has yet to adjust its...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Advisers have opportunity to deepen private market engagement

Advisers have opportunity to deepen private market engagement

Most client allocations to private markets are either 5%-10% or 1%-5%

Isabel Baxter
clock 18 November 2024 • 2 min read
Royal London cuts number of governed range portfolios

Royal London cuts number of governed range portfolios

Renaming remaining portfolios to reflect level of investment risk

Jenna Brown
clock 18 November 2024 • 1 min read
AJ Bell cuts fees across multi-asset income range

AJ Bell cuts fees across multi-asset income range

£1.5bn of inflows this year

Beth Brearley
clock 14 November 2024 • 1 min read