Active global equity fees have dropped 11% since 2017: LCP


first_imgThe average annual fee for a £50m investment mandate was 65bps, down from 73bps in 2017, saving £40,000 a year, according to the consultant.It added that the largest contributing factor to declining fees was decreasing allocations to active equity mandates.LCP calculated that, as a result of DB schemes changing their asset allocations since 2010, the average scheme was paying more in fees to credit and liability-driven investment managers than to equity managers.Fixed income costs on the riseWhile the average fee for actively managed global equity had decreased by £40,000 for a £50m mandate, the cost of a similar-sized corporate bond mandate had risen by £35,000.LCP suggested that the increase in fixed income fees could be due to pension funds’ demand for bespoke and more sophisticated fixed income strategies.The survey also found wide variations in reported transaction costs for listed infrastructure and actively managed global equity.“This illustrated the need to ask managers to explain and justify these costs,” said LCP.Matt Gibson, head of investment research at LCP, said that falling investment manager fees had allowed investors the opportunity to renegotiate their fees to the new market level.However, he highlighted that reduced costs didn’t always result in value for money “as fees and costs should be considered against the value created by the investment manager”.The LCP survey found that transaction costs for global equity and corporate bonds added 25% and 45%, respectively, to asset management costs on average.It noted that, despite regulatory pressure, many asset managers had not been able to provide detailed transaction cost information, only providing a full breakdown of these costs for 170 of the 677 surveyed products.LCP said that a change in regulation at the end of 2017 had allowed for accurate and comparable analysis of transaction costs data for UK institutional investors for the first time in the history of the survey.The LCP survey was conducted among 71 asset management organisations and covered 49 asset classes.Further readingManagers urged to comply with new cost disclosure templates The UK could legislate to enforce new cost transparency codes if investment managers and service providers do not comply voluntarily, the country’s pensions minister has warnedCost transparency poses threat to asset managers, says Moody’sThe UK’s newly launched investment cost reporting templates could hurt asset managers’ business models and financial stability The average fee for an actively managed global equity mandate for a UK institutional investor has fallen by 11% since 2017, according to LCP.In its latest Investment Management Fee Survey, the consultancy cited increased competition and downward pressure from low-cost index trackers as the main reasons for the fall.The survey also revealed “notable” fee reductions in a range of other key asset classes, including multi-asset diversified growth funds, multi-asset credit, liability-driven investment strategies, and passive global equity mandates.The pensions adviser estimated that a typical £500m (€548m) defined benefit (DB) pension fund in the UK had seen a reduction in total investment fees from 39 basis points to 36bps, or £140,000 a year, in the past 10 years.last_img read more

Murguruza claims French Open title


first_imgThe Spaniard won in straight sets 7-5, 6-4 to claim her first ‘major’ title.Williams is still one Slam behind Steffi Graff after the defeat in Paris.However, she’ll hope to draw level with the German at Wimbledon, which starts later this month.last_img

Federer donates almost a million euros to help Switzerland


first_imgSport has turned to struggle the coronavirus disaster, which has already left greater than 400,000 contaminated worldwide, lots of them within the international locations of Europe with Italy and Spain as essentially the most affected.The coronavirus has additionally reached Switzerland, the place the federal government has decreed quarantine after greater than 10,000 infections and 135 deaths.. Confronted with this example, the nation’s highest ambassador wished to take a step ahead to get entangled within the struggle in opposition to the virus. This Wednesday Roger Federer introduced by way of social networks that he and his spouse Mirka Vavrinec have determined to donate one million Swiss francs (943,000 euros) to help the neediest households within the nation by way of a assertion written in English, German and French. “These are difficult occasions for everybody and nobody ought to be left behind. Mirka and I’ve determined to donate one million Swiss francs to essentially the most susceptible households in Switzerland. Our contribution is the start. We hope that others will be part of us to help households in want. Collectively we’ll overcome this disaster! Keep wholesome!“Federer stated. Yet another instance that demonstrates the magnificence of the Swiss each on and off the tennis courts.last_img read more