Smith & Williamson and Pictet Asset Management are both to cut annual management charges (AMCs) on a variety of funds as part of an overhaul of clean pricing strategies.
Smith & Williamson will reduce charges on the unbundled share classes of 13 of its funds, with the typical equity fund charge falling from 75bps to 65bps and the typical bond fund AMC dropping from 65bps to 55bps.
The changes, effective as of 1 April, will also see the AMC on its Global Gold & Resources fund fall from 100bps to 65bps.
“We at Smith & Williamson have looked carefully at the level of our fees, and concluded that we can reduce them for those funds which are not capacity-constrained," Smith & Williamson head of marketing and sales Nick Hodgson.
AMCs will not be reduced on the three capacity-constrained funds with clean share classes. These are the Short-Dated Corporate Bond B class (65bps AMC), MM Cautious Growth B class (70bps) and the C share class on the UK equity long/short Enterprise fund (90bps).
Pictet, meanwhile, is to cut prices on some funds from 75bps to 60bps as it refocuses on five core offerings in the UK market: its Japan Opps, Water, High Dividend Selection, Emerging Local Currency Debt and Small Cap Europe funds.
Smith & Williamson's Hodgson, meanwhile, said funds must strike a balance between offering good value for money while remaining commercially realistic: “Our aspiration is to deliver good active management returns and we believe this should be recognised with fees higher than those levied by passive funds, so long as they are set at a sensible level.”
Smith & Williamson AMCs
| Fund | Old AMC (%) | New AMC (%) |
| Cash | 0.7 | 0.3 |
| European Growth B class | 0.75 | 0.65 |
| Far Eastern Income & Growth B class | 0.75 | 0.65 |
| Fixed Interest B class | 0.65 | 0.55 |
| Global Gold & Resources B class | 1.00 | 0.65 |
| Global Government Bond B class | 0.65 | 0.55 |
| Medium-Dated Corporate Bond B class | 0.65 | 0.55 |
| MM Endurance Balanced B class | 0.75 | 0.65 |
| MM Global Investment B class | 0.75 | 0.65 |
| North American B class | 0.75 | 0.65 |
| Oriental Growth B class | 0.75 | 0.65 |
| UK Equity Growth B class | 0.75 | 0.65 |
| UK Equity Income B class | 0.75 | 0.65 |
