Investments  

Pacific Assets trust overhauls fee structure

Pacific Assets trust overhauls fee structure

The Pacific Assets investment trust has overhauled its fee structure, binning its performance fee but increasing its annual management charge.

The Asia-focused trust, managed by First State but administrated by Frostrow Capital, has raised its annual management charge from 0.75 per cent of net assets to 0.9 per cent.

The increase in the base fee has been designed to offset the removal of its performance fee.

Article continues after advert

Previously First State was awarded 12.5 per cent of the trust’s outperformance of the MSCI All Country Asia ex Japan index above a ‘hurdle’ of 1.75 per cent, measured over a rolling three year period.

The board of the trust has also negotiated a reduction in its admin fee to Frostrow from 0.2 per cent of its market cap to 0.15 per cent of its net assets, falling to 0.10 per cent for the portion of its assets over £275m.

As part of the new fee arrangements, First State will have to take over the marketing activity for the trust from Frostrow.

In a statement, the board of the trust said it had tried to simplify the fee structure and get rid of the “volatility created by the performance fee”.