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Trading costs add 50% to fund manager fees

New research into what large investors pay out suggests trading costs are ‘clearly material’

Trading costs add 50% to fund manager fees
Photo: Getty Images

The cost of buying and selling shares and other securities adds an extra 50% to the base fees charged by fund managers, according to a new study that claims to be one of the most detailed ever completed on the subject.

Transaction costs, which are typically not included in managers’ fees but taken out of a fund to pay brokers before returns are paid to investors, have become a subject of controversy in recent years, with campaigners railing against “hidden fees”.

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