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JP Morgan to launch the UK's first 'RDR-ready' Oeic
by Dylan Lobo on Jan 28, 2011 at 15:17
JP Morgan Asset Management has set out a challenge to the passive market with the launch of a low cost active managed fund, which it claims to be the first 'RDR-ready Oeic'.
From the 1 February, the JPM UK Active 350 fund will be renamed the JPM UK Active Index Plus fund and carry a significantly reduced annual management charge of 0.25% per annum and fixed expenses of 0.15% per annum (0.40% per annum combined).
The fund will seek to outperform the FTSE All-Share index and will charge a performance fee of 10% (with a cap) when it does - meaning the total expense ratio (TER) of the fund will not exceed 0.55%.
The changes were approved today, by a majority of existing shareholders at an extraordinary general meeting.
The fund, in its new guise, will continue to be actively managed by the same investment management team as before, led by Michael Barakos, using the same investment process but with a lower risk management framework.
It will change its benchmark from the FTSE 350 index to the FIDS All Share Index in line with other comparable products.
JP Morgan head of UK retail sales, Jasper Berens, (pictured said: 'We know that today’s investors are increasingly concerned about fund charges and a preferred route to seeking lower cost funds has been through lower risk investments. However, the solutions currently available to them are dominated by passive tracker funds. We believe that many investors buy these funds because they are low cost rather than because of a specific preference for passive management.
'We’ve now created a low cost actively managed alternative that meets investor demand and challenges passive investing. We have also designed this product to be our first, and possibly the retail fund management industry’s first ‘RDR ready’ Oeic with all adviser commissions stripped out.'
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