Property News · February 27, 2016

The fund management fees you have to pay even if you lose money


You’d have lost money in Fidelity’s China fund last year, but still been asked to fork out for ‘outperformance’ chargesFor some investors it looks like “heads you lose, tails they win”. After a torrid six months for the global markets, many small investors have lost considerable amounts of money. But because of the way “outperformance” fees are structured, some funds are paying themselves huge bonuses because they didn’t fall quite as much as the stockmarket overall.For example, every £1,000 invested in Fidelity’s £700m China Special Situations Trust in January 2015 was worth just £903 12 months later. But Fidelity will charge shareholders in the fund a special outperformance fee, over and above the standard annual charges, because the losses it has made are not as bad as those in its benchmark, the MSCI China index. Continue reading…

Source : theguardian.com
Read more…The fund management fees you have to pay even if you lose money

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