Fund charges reduce 10-year returns by 28% - Lipper

Annual costs have reduced returns of the average equity fund by 27.9% over a ten-year period, a Lipper report has revealed.

As the ongoing fund charges debate continues, Lipper's FundIndustry Insight Report on Balancing Business and Investor Interests said the average equity fund return over a decade was 98.7% before the costs of running the fund were taken into account. Annual costs, such as administration or management fees, reduced this figure to 71.2%, lowering an investor's final return by 27.9%. Ed Moisson, head of UK and cross-border research at Lipper and author of the report, said: "Clearly fund management, active or passive, cannot be free of costs, but this is useful to know on the impact of cha...