LGIM slashes charges on index fund range

The reduction will apply to the “clean” priced units, called the “I” unit class, which are available on platforms. It will also apply to intermediary deals that meet a minimum investment levels.

The company expects index funds to continue to grow in popularity, rising from just over 10 per cent of all IMA retail mutual funds under management to 19 per cent by 2020.

Seven LGIM funds are on the Hargreaves Lansdown Core Tracker list, which is a list of the platform’s favourite tracker funds, and will be at least a third lower than on the other platforms.

Adam Laird, head of passive investing at Hargreaves Lansdown, said: “Lower charges are great news for investors. This is the latest in a string of price cuts and investors are benefiting from lower costs for passive fund management.

“Passive investing is a growing market in the UK. Assets have grown 25 per cent in the last year, and over half of September’s retail fund sales went into index trackers.”

Honor Solomon, head of retail distribution Europe, Middle East and Africa for LGIM, said: “Price is a key factor in the popularity of index funds and we are delighted to be able to bring to market a highly competitive set of new prices on a comprehensive range of asset classes.”

LGIM manages £16bn of retail index funds.

The change will take place on November 1.