People have the right to know when a fund takes more out in charges than it gives them in return.
(PRWeb UK) February 9, 2010
Consumer advice website http://www.howmuchdoineedtoretire.co.uk conducted research into the retail fund market in the early weeks of January 2010. The result is a report which identifies funds that have charged investors more in the past ten years than they returned in investment value.
Some highlights from the report:
- Over £100 billion is estimated to be in funds that have charged more than they have returned in the past ten years.
- Fund managers are estimated to have taken £9.6 billion in charges for managing these funds over the past ten years.
- Over 500 funds meet the criteria, with 260 funds being of significant size (more than £100 million).
- Many household names guilty of multi fund failure.
Commenting on the findings of the report, its author Matthew Morris says, “Fund managers look after money on the basis that they can offer extra value to the investor; where a fund charges a fee it must be for providing this additional value. Where the fees they charge are more than the return they give, it must be seen as a failure of their management team or the individual fund manager.”
“People have the right to know when a fund takes more out in charges than it gives them in return.”
“Ten years is a long time for a fund to consistently take more off the investor than it gives in return and we have no hesitation in drawing people’s attention to this outcome.”
“It was a great surprise to us to find the extent of this practice and also some of the managers and their funds which fell into this category.”