Is transparency of fund costs a good thing?

dunstonh

Zebra wrote: »

Wrong.

I pay my own way thank you.

In which case, the new charges would be lower than the old. So, what is the problem?

jamesd

Rollinghome wrote: »

As JamesD points out in a post here it now emerges that Hargreaves Lansdown have been receiving up to a full 1.00% of the AMC we paid to the fund managers to manage our assets.

I did pick a selection of the highest in the Wealth 150 - the top five. Here's how it breaks down for all of them, commission retained by HL, compared to commission rebated in Loyalty Bonus and AMC:

0.90 and up: 6 funds mean 0.95 mean Loyalty Bonus 0.05
0.80-<0.90: 7 funds mean 0.836 mean LB 0.196 mean AMC 1.707
0.75-<0.80: 9 funds mean 0.757 mean LB 0.053 mean AMC 1.489
0.70-<0.75: 10 funds mean 0.714 mean LB 0.113 mean AMC 1.500
0.65-<0.75: 11 funds mean 0.659 mean LB 0.184 mean AMC 1.500
0.60-<0.65: 21 funds mean 0.614 mean LB 0.196 mean AMC 1.457
0.55-<0.60: 16 funds mean 0.559 mean LB 0.217, mean AMC 1.453
0.50-<0.55: 4 funds mean 0.506 mean LB 0.000 mean AMC 0.8875
0.40-<0.50: 2 funds each 0.4 each LB 0.15 each AMC 1.0
0.35%: 1 fund 0.35 LB 0.15 AMC 0.9
0.15: 1 fund 0.25 LB 0 AMC 0.65

For all 88 funds mean 0.658 mean LB 0.152 mean AMC 1.449. Mean commission 0.81%. Mean retained by fund 0.639.

So on average HL is getting 0.658% while fund manages are getting 0.639% and customers are getting an AMC rebate of 0.152%. Just for these funds, not for all 2,000 or so.