Kames to scrap performance fee but lift AMC on UK Absolute Return fund

Kames Capital is to remove the performance fee on its UK Equity Absolute Return fund  but is seeking to raise its annual management charge by five basis points.

The firm decided to waive the performance fee from April last year, but has opted to scrap the plan altogether in favour of simplifying and streamlining the fund's fee structure in the post retail distribution review (RDR) world.

As an example the hike in AMC will mean the fund's B share class fee will rise from 0.75% to 0.80%, while the A share class cost will rise from 1.5% to 1.55%.

Kames said the fee hike is due to the ‘complexity and additional costs associated with running absolute return funds.’

Kames Capital’s head of retail distribution Steve Kenny added: ‘We have made these changes following consultation with our client base.

'Our conclusions from that feedback were for this type of fund there is an overwhelming desire for simple fee structures in the post-RDR world.

‘We have increased the annual management charge because of the additional complexity and time required to manage an absolute vehicle.’