INVESTORS have been told to stump up more money if they want to invest in funds run by some of Standard Life Investments' top fund managers such as smaller companies specialist Harry Nimmo.
SLI has bucked an industry-wide trend towards lowering fund fees by telling investors it is upping the charges on seven of its top funds.
For instance the annual management charge (AMC) for private investors in Mr Nimmo’s UK Smaller Companies fund is to rise from 1.5% to 1.6% from November 1.
There is an identical increase in the charge for the Standard Life Investments Global Equity Unconstrained fund run by Mikhail Zverev.
The charge on a suite of fixed income funds, including the Edinburgh house’s Global Index Linked Bond, UK Gilt, Corporate Bond, Select Income and Higher Income funds, is to rise from 0.95% to 1%.
Jacqueline Kerr, head of UK wholesale at SLI, said: “We conduct regular reviews of our products to ensure that we offer a simple charging structure which offers consistency across the range while remaining competitive within the market.
“Within our fund range we have a number of bond funds which were launched with an AMC of 0.95%.
“The charge has been held at this level since launch, in some cases as much as 16 years.
“However, following the most recent review, the AMC on these funds has been increased to 1%.
“This is a level which we believe is consistent with other funds offering similar market exposure.”
She said that the other two funds have also had their charges brought into line with similar funds run by the house.
“Standard Life Investments remains committed to providing exceptional investment returns, a competitive charging structure and offering value for money to our customers,” she said.
However, Duncan Glassey, partner at Edinburgh-based wealth manager Wealthflow, told The Herald: “We think the fund manager industry in the UK is already expensive relative to other places, particularly the United States.”
He said that when dealing and other charges are added on top of the management charge, investors can find themselves paying as much as 2.5% a year. This, he said, can eat into the returns they get from their investment.
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