Fees for investment funds

N

noelfitz

Registered User
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I am considering a Standard Life MyFolio bond, but while it says management charges are about 1.25% I see a claim it is really over 4%.
What are real fees and are funds such as these innadvisable?
I submitted a similar query, but may have put it in an incorrect place, and my post may have lacked focus. Please help.
 
The real way to get an insight into Fund Fees for any of these funds is to request from the company, as to what is the TER (Total Expense Ratio). A company like Standard Life should willingly give you the figure.

As a point of note any company that refuses to give you the requested figures isn't worth doing business with (IMO).
 
The TER of a fund equates to the annual management charge (AMC) of that fund, plus any additionally charges that are applied to the fund but which are not included within the AMC. These additional charges may include charges such as fund custodian and regulator fees.

The TER of a fund does not however include other fees which are not part of day-to-day fund management and therefore not applied by the fund manager e.g. the Irish government pension’s levy and financial adviser fund based renewal commission.

It is currently not a requirement in Ireland for investment companies to disclose TERs in their customer literature, however Standard Life are always happy to disclose TERs of their funds if asked.

As the majority of Standard Life’s funds in Ireland are managed in-house by their own fund management company, Standard Life Investments (SLI), they have regular oversight of their fund’s TERs and aim to keep them as low as possible for their customers. The majority of their fund’s TERs are very near to their fund’s AMCs.

For the five MyFolio Active funds (i.e. the MyFolio funds with all SLI underlying funds) the TERs are as per the below:

MyFolio Active I: AMC 1.15%, TER 1.21%
MyFolio Active II: AMC 1.20%, TER 1.26%
MyFolio Active III: AMC 1.25%, TER 1.30%
MyFolio Active IV: AMC 1.30%, TER 1.35%
MyFolio Active V: AMC 1.35%, TER 1.40%

If in doubt about any of the charges, just ask Standard Life directly.
 
There is a misconception that the management charge is the actual cost of buying/selling stocks. That is why you get a lot of people giving out about the charges on cash funds.

The management charge is the cost of running the company and a bit of profit. All trading costs are additional and are taking into consideration when the unit price is set each day.

Standard Life have some good funds but are at the higher end price wise.


Steven
www.bluewaterfp.ie
 
OP and Others, whilst others may be offering advice on buying product from credible institutions, I believe it is best to obtain an opinion from a face rather than persons that remain unknown on a Forum.

More important, DO YOUR OWN RESEARCH, before parting with any money.
 
shipship said:
Who offer index funds at the lower price end?
Click to expand...

The management fee doesn't pay for the cost of the funds, it pays for staff, rates, insurance, regulation costs etc and profit. The actual trading costs are incorporated in the unit price.

If it's an investment, look at some of the online traders mentioned here. If it's pension, Zurich Life do a good deal for funds over €50,000 and an even better one for funds over €100,000. Doesn't apply to investment money, only pension related.


Steven
www.bluewaterfp.ie
 
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