Number of funds with performance fees decline

Arrow down1The use of performance fees by UK unit trust and open-ended investment company (Oeic) funds has declined in recent years, according to a recent report by Lipper.

In Performance Fees: Paying Your Dues?, Lipper said the number of new fund launches adopting such fees had fallen dramatically and other funds were being closed or merged.

Around 3% of unit trusts and Oeics overall have a performance fee structure. Among absolute-return funds, however, the figure is 63.5%.

Ed Moisson, head of UK and cross-border research at Lipper, said: “It seems much more likely that most of the new launches using performance fees will come from offshore rather than locally domiciled funds.”

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