Hargreaves Lansdown chief executive Ian Gorham is supportive of the Investment Management Association’s (IMA) proposed new system to highlight the impact of costs on the performance of an investment fund.
IMA chief executive Daniel Godfrey informed that the system would call on fund managers to calculate the number of units in issue on a daily basis over the year and divide that by the total costs.
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Gorham said: "The UK public should invest more and investing in funds is a great option for a starting retail investor. The more a product is simple and trustworthy, the more likely people are to be attracted to invest in it."
He added: "We believe with some additional work Mr Godfrey’s suggestions could be evolved into a single, all inclusive total cost figure which is comprehensive and easily understood by the public.
"We would also like to see the use of a sector comparator so that investors can see how the charges on a particular fund compare with other funds of a similar nature. This would help them to judge whether they are getting a good deal."
Gorham said he has written to the major fund management company chiefs suggesting they consider Godfrey’s proposals.
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By GlobalData
