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Fee foes fight AuM: investors smell blood on percentage sums

Big investors are beginning to cross the last rubicon on fund managers' fees — why are they paid a percentage of managed assets at all?

Investors grumble that fund managers take too big a bite on fees
Investors grumble that fund managers take too big a bite on fees Photo: Getty Images/Westend61

Fund managers are getting quite used to moaning about their fees. But now their biggest customers are starting to question the economic principle that underpins the pay packets of their entire industry.

We all know investors' usual grumbles: fund managers earn too much, they take too large a share of performance (when they manage it), they don't compete on price, and they don't suffer losses when they lose investors' money.

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