FAO Hargreaves Lansdown customers

allanhamer

greenwich wrote:

You may well be right, Carnet. Looking at a few other multi-manager funds, they do seem to have higher TERs, though not as high as HL's, which may just reflect higher churning by HL. The annual charges of other managers won't show up in the TER though, only their initial charges.

This is actually incorrect, the FSA rules state that underlying annual charges must be included in the TER calculation unless for instance all of the annual fee is rebated (renewal commission) to the MM fund. The TER is the total expenses of the fund excluding the initial charge. This included the managers annual charge, safe custody fees, registration charges, audit fees and FSA fees.

I actually work for Marlborough Fund Managers, I'm not sure where you got the 0.08% figure from, I presume this was from our Key Features document which did not have to disclose a TER. The 0.08% was the annual charges excluding the managers service charge of 1.50%. In effect the charge you would have been looking at was 1.50 + 0.08 = 1.58%,
The TER came in under the new Simplified Prospectus regime which came in to effect on 1 March 05 with a transitional period to 1 October 05. The actual TER for our Special Situations Fund is 1.49% which represents the annual charges (made up of Managers charge, FSA fees, safe custody fees, trustee fees and audit fees).

As previously mentioned the MM funds have higher charges as they are a fund of funds and as such if the underlying investments in that fund do not rebate the annual charge to the MM fund then you are in effect paying an annual charge on top of an annual charge, hence why they percentage figure is much higher than in comparison with a single fund unit trust such as the Marlborough Special Situations.

Hope that clears some things up for you. If you need any further clarification please post in here.

Cheers

Allan