Terry Smith: Platforms adding to fund costs, not reducing them

Terry Smith, the City veteran and founder of low cost fund management group Fundsmith, has attacked platforms in the UK for adding to the overall cost of investing in funds.

Smith - who has launched his own equity fund which is listed on Skandia's platform - said fees on funds in the UK were being inflated by pressure from platforms. "Fund management fees are too high in the UK. One of the reasons is the advent of fund platforms," Smith said in a draft of a speech he intends to deliver to attendees at the 25th annual Tacitus Lecture tonight. "The platforms get their revenue from trail fees paid from a proportion of the funds' management fees. They therefore have a vested interest in management fees remaining high enough to pay their trail fees." Smith ...