Do (SJP) funds performance reports include all fees?

max888

Hi,

I have been talking to a FA in the SJP network.
They described the fees for a portfolio in a pension fund at 1.89%/year (excluding early exit fees), broken down as:
- 1% SJP admin
- 0.5% advice fee
- 0.39% fund management fee

Now I am not clear whether those fees are already included in the performance report or are to be applied on top. 

For example this fund shows a TER 1.97% which I expect to be already included in the performance report:
https://www.trustnet.com/factsheets/P/0rgd/sjp-global-value-pn/
Do I need to consider an additional 1.89% cost to evaluate the actual growth when investing the the SJP FA?

SJP FA claims it is included, but this is a bit confusing for me since on other platforms (i.e.Vanguard) the performance figures only includes the fund fees, and platform fees are applied on top.
Does anyone have a direct experience?

talexuser

Why choose SJP with their high fees, poor performance, and dubious exit policies. Their share price has just halved on forcing exit fees to be dropped by the authorities:

https://www.yodelar.com/insights/51-of-st.-jamess-place-value-disappears-should-clients-be-concerned?utm_medium=email&_hsmi=281068865&utm_content=281068865&utm_source=hs_email

Stubod

..I have a bargepole you can borrow???

dunstonh

Since 2018 when MiFIDII was introduced, you would expect fees to be displayed as follows:
Platform/provider charge
Adviser charge
Fund OCF (no-one uses TER anymore expect with ETFs or some offshore funds)
Fund TC
Fund IC
Total

However, life and pension funds show slightly differently.   

In my experience with the local SJP rep, they tend to leave off TC & IC.   This is in part because SJP use old fashioned investment funds and set up that requires a lesser disclosure.

SJP FA claims it is included, but this is a bit confusing for me since on other platforms (i.e.Vanguard) the performance figures only includes the fund fees, and platform fees are applied on top.

Vanguard falls under MiFIDII as they do not offer life or pension funds.   So, its not quite like for like.

I have been talking to a FA in the SJP network.

Are you nuts?   The most expensive salesforce in the country.    The choice should be IFA or DIY.   Not FA/sales reps.

cloud_dog

max888 said:

Hi,

I have been talking to a FA in the SJP network.
They described the fees for a portfolio in a pension fund at 1.89%/year (excluding early exit fees), broken down as:
- 1% SJP admin
- 0.5% advice fee
- 0.39% fund management fee

Now I am not clear whether those fees are already included in the performance report or are to be applied on top. 

For example this fund shows a TER 1.97% which I expect to be already included in the performance report:
https://www.trustnet.com/factsheets/P/0rgd/sjp-global-value-pn/
Do I need to consider an additional 1.89% cost to evaluate the actual growth when investing the the SJP FA?

SJP FA claims it is included, but this is a bit confusing for me since on other platforms (i.e.Vanguard) the performance figures only includes the fund fees, and platform fees are applied on top.
Does anyone have a direct experience?

Given your example of three charges, and for this specific fund wouldn't you simply replace the 0.39% with the 1.97%, making a total of 3.47%!!!

I believe the TER includes trading costs.

Grandst2

Every basis point you pay costs you thousands on large lump sums over the long term. SJP will cost you hundreds of basis points over what you should be paying. I would leave scorch marks  on the earth running away from them.

max888

Thanks for the replies!

I know this forum is generally against SJP and I have myself also always being looking at low fees / index funds.

I know SJP fees are higher, but 1.89% seems reasonable and what really matter is the return after costs. The fund I linked consistently got higher returns than indexes. So I am trying to figure out what is the actual final cost from the performance figure, to be able to do an objective evaluation.

Disclaimer: I am also aware that this fund is an exception and doesn't necessarily reflect most SJP funds performances.

dunstonh

I believe the TER includes trading costs.

On OEICs/UTs TC is separated but synthetic and not a real charge.  Its what happens when you let politicians decide something they don't know anything about.

I know SJP fees are higher, but 1.89% seems reasonable and what really matter is the return after costs. 

For comparison, I have just finished a review where the total ongoing charges are 0.82%.    So, I guess it depends on what you consider reasonable.  

 The fund I linked consistently got higher returns than indexes.

Just a handful of some of the big guns...


SJP is also the most volatile.

And because of its focus, it will have periods of underperformance due to its very nature.   So, not consistent as you claim.

jimjames

max888 said:

Thanks for the replies!

I know this forum is generally against SJP and I have myself also always being looking at low fees / index funds.

I know SJP fees are higher, but 1.89% seems reasonable and what really matter is the return after costs.

essarily reflect most SJP funds performances.

I certainly wouldn't call 1.89% reasonable. Every extra percentage is reducing the amount in your pot every year. My SIPP with Vanguard costs 0.15% platform fee and 0.23% for the global all cap fund for example. That's a total of 0.38%.

If you have £100,000 in each pot for 10 years, you'd have paid just over £5k in charges with Vanguard or nearly £27k with SJP at 1.89%. That's nearly £22,000 more in your pot with Vanguard and that's "only" with costs of 1.89% for SJP.

max888

I have this graph for the same fund (+160% in latest 10yrs)



I was comparing SJP to my current Vanguard investments.
On Vanguard UK, the global equities funds I would have considered are:
- FTSE all world (10yrs: +93%)
- Life strategy 100% eq. (10yrs: +132%)

Both performed less than the SJP fund. 

Vanguard have much lower fees, but if SJP has products which could offer overall better returns on the long term, why should I be fixated on the fees? Or am I missing additional hidden costs in SJP, as per my initial question?

Prism

max888 said:

I have this graph for the same fund (+160% in latest 10yrs)



I was comparing SJP to my current Vanguard investments.
On Vanguard UK, the global equities funds I would have considered are:
- FTSE all world (10yrs: +93%)
- Life strategy 100% eq. (10yrs: +132%)

Both performed less than the SJP fund. 

Vanguard have much lower fees, but if SJP has products which could offer overall better returns on the long term, why should I be fixated on the fees? Or am I missing additional hidden costs in SJP, as per my initial question?

The Vanguard FTSE all world fund has produced a return of 161% over the last 10 years. I think you may be looking at the returns for NAV that Vanguard provide in Dollars (93%).

Life Strategy has not performed as well.

Also, I don't believe that the fund fees from SJP include the 5% that you need to pay up front, that you never get back. You are 5% down before you start which makes the rest of the journey all that harder. You don't get to pick your own funds so only a small amount would have been in that well performing one.