Fund managers reject calls for full portfolio disclosure

Mr Miller launched a “True and Fair” campaign on January 31 calling for asset managers to report all fees that are paid by investors in a more transparent way, and also demanding publication of full portfolio holdings breakdowns every quarter.

Fund giant Fidelity later issued its own public call for a more transparent system for reporting fund fees, but did not add its voice to calls for full fund portfolio breakdowns to be published.

BlackRock’s UK retail managing director Tony Stenning said full portfolios were already disclosed in annual reports and accounts and more regular reporting could cause portfolios and investors to suffer.

He said: “If you published every week, for example, there is potential for people to arbitrage against you. There is an element of transparency that it is important to have, but too much can be counterproductive to what you want to achieve. I would be very wary of doing that.”

HSBC Global Asset Management’s head of wholesale Andy Clark added that any new rules needed to be “realistic”, adding that portfolio data could be seen by some managers as “too sensitive” to publish regularly.

Currently, UK funds are required by the IMA’s Statement of Recommended Practice - parts of which the FSA has incorporated into its Coll rulebook - to publish a full breakdown of their portfolios in their annual and half-yearly reports.

In the US, fund managers are encouraged by the regulator, the Securities and Exchange Commission, to publish quarterly breakdowns of their portfolios. Most equity funds publish their top 25 holdings every three months, although there is no mandatory requirement to disclose the entire portfolio.

Mr Miller said: “It should be possible in the internet age that consumers can access full information about where their money is invested. A lot of fund scandals involved misselling, but things like Arch Cru happened because people didn’t know what they were invested in.”

The code which Mr Miller has proposed states: “Company XYZ commits to providing clients with a full online breakdown of all holdings held directly, as well as indirectly (e.g. individual assets held as collateral against securities lent out), together with a full percentage breakdown, online, on at least a quarterly basis.”