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Home > Investments > Wraps & Platforms

By Bradley Gerrard | Published Aug 30, 2012

Cofunds to add 1,700 ‘clean fee’ share classes

Cofunds has said that it will make 1,700 ‘clean fee’ share classes from 85 different fund providers available to advisers when it launches its unbundled pricing structure.

The platform has already outlined plans to offer an unbundled structure to advisers to enable them to comply with the FSA’s RDR ban on advisers receiving commission, when it comes into force on January 1 2013.

In September 2011 Cofunds said it would launch its unbundled structure in the third quarter of this year.

In a statement today the platform said it would “champion” clean share classes, which fund providers are now launching in droves to enable advisers to comply with the RDR.

Clean fee fund share classes carry average annual management charges of 75 basis points, and adviser trail commission and platform rebates are not bundled in.

Some groups, including Invesco Perpetual, have launched 1 per cent share classes which effectively retain a ‘bundled’ platform rebate, but Cofunds has actively rejected this model in favour of charging fees for its platform services.

Alastair Conway, sales and marketing director at Cofunds, said the move towards ‘clean’ share classes had “demonstrated a real support for simple, transparent charging” which he added has “got to be good for end investors”.

“Importantly, it’s also good for advisers as it clearly defines each chargeable element of the value chain and in so doing should make it easier to explain the fee-based world to clients,” he added.

“So this is an essential step towards enabling people to accurately assess the value of the service they’re receiving - resulting, one would hope, in a shift away from a preoccupation with knowing the price of a service without an appreciation of its value.”

Fidelity FundsNetwork was the first major platform to announce its unbundled pricing structure of a flat 0.25 per cent annual platform fee as well as an optional £45 a year account fee for clients of its ultra-simple unbundled option.

Meanwhile Skandia has said it will levy a single platform charge based on the level of customer assets on the platform with no additional charge for product wrappers.

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