Evercore and 7IM under fire for failing to include ETF costs in TERs

Maybe they are both trying to make their portfolio's appear reasonably priced by using technicailities!! Doesn't sound very client friendly does it?

At the end of the day, if the client is going to incur costs they need to know about it and if they are trying to make comparisons, hiding such charges does not help the client.

rdr has a future to avoid these kind of issues, sooner we move to all providers using TER the better. It is hard to do dierct comparisons on charges but then they are only a small part of the advice process for most clients.

This again highlights the issue that discretionary firms are selective in what they disclose when compared to what they actually charge. Yes this is only part of the advice process, but if I (as an IFA) am recommending my client should use the discretionary firm, doesn't that make it all the more important that I understand exactly what is being charged?

Even getting all providers to quote TERs doesn't resolve the issue, when they each have a different interpretation of what consitutues a TER

If it is a cost drag on performance (which it is) Treating Customers Fairly would suggest that the TERs of ETFs should be included in the overall TER.

I've come across funds of funds investing into investment trusts, but not including these costs and so lowering their overall TER. This would seem to have a bigger potential impact than that for ETFs.

7IM have always seemed pretty straightforward about their fees to me.

So this begs the question, who do you trust?

Which is the best discretionary firm out there? Answers on a postcard

This is typical of the disingenious approach taken by so many fund managers - "oh dont worry about it, its only a small cost and we won't bother telling you about it"

I am currently dealing with a DFM who have confirmed in writing to my client that "the only charge you pay is our annual fee of 1%" - the fact that they are buying underlying portfolios of expensive active OEICs, as well as trading costs, spreads, stamp duty etc is completely ignored.

Thankfully the market is finally waking up to this sharp practice and things will eventually change - although Citywire seem reluctant as their existence is funded by some of these outfits through advertising.

I tend to agree with Anon 3 that 7IM are a very straightforward outfit.

Maybe I am biased as I use them personally and as an IFA for clients and they have always done "what it says on the tin", particularly after what we have just been through.

We all sleep well at night!!