Royal London Asset Management (RLAM) is to move to a new fee structure that the firm says will slightly increase fees for some funds but be “clearer and simpler” for customers to understand.
From June 3 RLAM will adopt a “fixed fund management fee” that will be displayed on factsheets and other materials.
The firm says the existing ‘ongoing charges figure’ (OCF) for its funds may vary on a month-to-month basis due to variations in the actual costs of running the funds.
The change will apply to Royal London Unit Trust Managers multi-asset, equity and bond funds. Transaction costs will continue to be disclosed separately.
The revised fee rates have been set with reference to fund size and expectations of future costs.
Most funds will see a slight increase in fees, the firm said, but the funds remain amongst the “lowest priced within their sectors”.
Multi-asset fund fees largely stay the same or fall by as much as five basis points (bps).
Increases in fees to bond funds are typically in the 1-2 bps range, though there are some significant reductions. For example, the Royal London European Corporate Bond Fund (Class Z) falls 10 bps to 0.30%, and the International Government Bond Fund falls from 0.49% to 0.30%.
Equity fund fees are in the table below.
Rob Williams, chief distribution officer, said: “Our customers want a better understanding of the cost of managing their funds, and the new fixed fund management fee does that – it provides them with both clarity and certainty. We will continue to monitor the fee levels to ensure our funds remain competitively priced while still providing excellent value for money.”
Fund Name (share class) and before/after fee
Royal London FTSE 350 Tracker Fund (Z) 0.12%/0.13%
Royal London Emerging Markets ESG Leaders Equity Tracker Fund (Z) 0.30%/0.35%
Royal London UK Equity Income Fund (M) 0.68%/0.72%
Royal London European Opportunities Fund (M) 0.73%/0.75%
Royal London European Growth Fund (M) 0.65%/0.70%
Royal London Europe ex UK Tracker Fund (Z) 0.23%/0.25%
Royal London Asia Pacific ex Japan Tracker Fund (Z) 0.26%/0.30%
Royal London Global Equity Diversified Fund (M) 0.38%/0.41%
Royal London Global Equity Select Fund (M) 0.67%/0.71%
Royal London Japan Tracker Fund (Z) 0.24%/0.25%
Royal London UK Mid Cap Growth Fund (M) 0.75%/0.77%
Royal London UK All Share Tracker Fund (Z) 0.14%/0.15%
Royal London UK Equity Fund (M) 0.65%/0.67%
Royal London UK Dividend Growth Fund (M) 0.65%/0.71%
Royal London UK Smaller Companies Fund (M) 0.72%/0.77%
Royal London UK Opportunities Fund (M) 0.72%/0.77%
Royal London US Tracker Fund (Z) 0.23%/0.25%
*Note: New fund management fees (on the right) will be the same as the OCF after the change.
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