Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Carmignac: paying for research will hurt fund firms

Carmignac: paying for research will hurt fund firms

French asset manager Carmignac has said Europe’s fund industry will be making itself uncompetitive with US rivals if the trend towards absorbing research payment costs continues.

In a statement to our sister publication Citywire Selector, the company said it had and would not waiver from this stance.

This is light of some firms, such as Janus Henderson, at first announcing plans to charge investors before reversing this and stating they would absorb the cost themselves.

Carmignac said it had prepared for and is ready to provide the transparency of research costs according to MiFID II objectives, which come into effect at the start of 2018.

It said: ‘This approach has three significant benefits: additional cost transparency for end investors, ensures the maintenance of wide coverage of European mid-cap companies which are the core of economic growth, and retains low barriers to entry for new asset management companies.’

Commenting on the decision to charge, Carmignac said many companies had been ‘provoked by some ETF fund managers’ to attempt to become cost competitive. However, it said it would be holding firm on its stance.

‘If this becomes the market standard, it will disadvantage European active asset management houses against the US based asset managers, and Europe will lose the three benefits of transparency, research coverage and low barriers to entry.’

‘Whatever the industry as a whole decides, as an active management house with an independent business and mind-set, we will continue to value the cross-fertilization of in-house research with external research.  

‘We will continue to nurture this model, which is central to our investment approach, and we will keep growing our internal team of analysts both on the fixed income and equity sides.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Wealth Manager Retreat 2017: size isn't everything

Wealth Manager Retreat 2017: size isn't everything

We asked our delegates at the Wealth Manager Retreat what they think about the recent wave of consolidation in the industry.

1 Comment Play CIO Tapes - part 3: 'passive funds are anti-capitalist'

CIO Tapes - part 3: 'passive funds are anti-capitalist'

Citywire recently gathered three of the UK's leading fund investment heads to discuss their hopes, fears and the issues that their jobs throw at them daily.

Play CIO Tapes: do investors have it as good as it gets?

CIO Tapes: do investors have it as good as it gets?

Citywire gathered three of the UK's leading fund investment heads to discuss what they fear and what makes them cheer about the year ahead

Read More
Your Business: Cover Star Club

Profile: from managing Brunei’s billions to Dorking’s pension pots

Profile: from managing Brunei’s billions to Dorking’s pension pots

Mole Valley Asset Management's boss on why he chucked in multi-billion mandates for Surrey wealth management

Wealth Manager on Twitter