'Superclean' funds

Chickereeeee

While aware that HL offered 'superclean' funds, and that other platforms had started to, I had not realised that a) they were so available and b) they were offered in parallel to the ordinary clean class, and you had to manually switch to them if you wanted to take advantage.

Fidelty do this (https://www.fidelity.co.uk/investor/funds/fund-charges/fund-discounts.page) and so do iWeb, but iWeb do not seem to tell you. They just list both fund classes....

C

talexuser

Basically when choosing a fund they give you the list of all the classes they do, you have to open all the fact sheets and see what the charges are for the same manager. How you keep up to date if once selected a newer (cheaper) class becomes available later might be more problematical?

Chickereeeee

talexuser wrote: »

. How you keep up to date if once selected a newer (cheaper) class becomes available later might be more problematical?

Exactly! In fact I had a fund holding on Fidelity for some time which I then also bought on iWeb via the ISIN number, only then to realise that both platforms now have a cheaper class... Grrr. Why have both classes for sale still?

C

talexuser

Chickereeeee wrote: »

Why have both classes for sale still?C

So they can make more money from people less wise than others? but to be fair I assume the discounts are just for those intermediaries who can satisfy some volume of sales criteria.

grey_gym_sock

talexuser wrote: »

So they can make more money from people less wise than others?

it will be the fund manager, not the platform, who keeps the extra charges from new purchases of more expensive fund classes. so there's no incentive for the platform to carry more expensive classes.

princeofpounds

it will be the fund manager, not the platform, who keeps the extra charges from new purchases of more expensive fund classes. so there's no incentive for the platform to carry more expensive classes.

You'd be surprised... often platforms can and do collect surplus fees, either directly (by showing a higher headline rate than the fund manager actually charges - often unit classes are created specifically to permit this) or indirectly (through rebates, though that practice is now much more restricted).


This is very common with tied products like corporate pension funds run on a platform.


Platforms are very powerful and often take over half the fees you see.

grey_gym_sock

i realize the platform review (PS13/1) doesn't generally apply to pensions, so in that case you don't know how much of what you pay goes to the platform. however, are you suggesting there are significant loopholes where it does apply?

AFAICR, it doesn't even apply to SIPPs, though the FCA was perhaps planning to extend it to SIPPs - is that right? however, platforms who offer both SIPPs and other platfrom services always appear to have the same fund charges for SIPP and other investments, so i wonder how much room for shenanigans that leaves?