30 January 2015 - Schroders has announced that it will be increasing the ongoing charge figure (OCF) for the Schroder Recovery fund, in order to bring it into line with the costs of other funds in their range. The OCF will rise from 1.51% to 1.66% on 15th February 2015.
However, the rise will only apply to the old bundled share class, or in other words, investments made before April 2014.
Bundled and unbundled pricing
Prior to this date, across the whole of the investment industry, the fund management fee, platform fee and intermediary service fee were all ‘bundled’ together and investors paid one annual charge. Following a review by the Financial Conduct Authority (FCA), as it is now known, it was decided that these charges should be ‘unbundled’ in future to increase the transparency of these charges. So, any investments made after 5th April 2014 were charged under the new structure.
Unless a client moves their previous investments to the new charging structure, they will remain in the bundled structure until April 2016, when they will be moved automatically.
How you can reduce your investment costs
At Chelsea, we have reduced our service fee from 0.5% to 0.4% under the new charging structure. We have also negotiated a reduction from 0.25% to 0.2% from Cofunds, our chosen platform provider. There are additional savings for investors with more than £250,000 invested with us. The more money you invest, the larger the discounts we can offer. You can find full details here.
This means that investors in the Schroder Recovery fund could save money by moving their investment to the new charging structure, if they haven’t done so already.
If you are one of these investors, or indeed still have some or all of the other funds in your portfolio on the older pricing model and want to benefit from our current cheaper charges, please download and complete the Share Class Conversion form.