Almost one in three newly-launched clean share classes are more expensive than their bundled counterparts, pension and wrap provider James Hay Partnership has claimed.
The company has monitored the cost of clean share classes compared to bundled equivalents when these funds are added to the platform.
In its most recent assessment it found that 30 per cent of clean share classes were more expensive than their bundled counterparts by an average of 10 basis points.
James Hay added in some cases the rebate share class was in line with the so-called super clean level.
In May of this year, FTAdviser found evidence suggesting the cost of investing for lower-value clients would increase with the introduction of clean share classes.
In an analysis of a selection of 19 clean funds found on the Cofunds platform and their bundled counterparts, FTAdviser found investors would have to invest at least £250,000 to ‘break even’ with bundled versions in 18 cases.
The clean share class of the M&G Optimal Income fund, for example, costs 0.3 per cent more than its bundled counterpart.
However, the clean version has been around for about six years.
For the Artemis High Income fund the total cost of investing has risen for a sub-£100,000 investor from 1.34 per cent to 1.49 per cent.
When adding funds to its platform, James Hay has confirmed its plans to compare the total expense ratio of the bundled and unbundled versions and retaining the former if it is cheaper than the latter.
Alastair Conway, chief executive officer of James Hay Partnership, said: “We already offer around 1,000 clean funds and we are on track to have over 2,000 by April 2014.
“As we add clean funds, we ensure equivalent or lower fund pricing is available on the platform.
“Advisers are rightly concerned about getting the best deal for clients, whether via clean or unit rebate.”
