Why investment trusts must scrap performance fees

INVESTMENT TRUSTS

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Jackie Beard, director of closed-end fund research at Morningstar, says more trusts need to follow the recent trend of scrapping or reducing performance fees.

Until the arrival of the RDR, investment trusts were often heralded for being a cheaper investment than their open-ended peers, albeit not in every case. With the RDR has come a greater focus on fees across all fund structures. It is no surprise we are seeing the price advantage often found in investment trusts erode away, as firms have started to launch clean share classes resulting in lower headline fees.  However, it is not just OEIC fee structures asset managers are tinkering with. There have been a number of changes made at investment trusts too, particularly with regards to per...

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