Jupiter shuts three funds and cuts fees in value assessment

Jupiter shuts three funds and cuts fees in value assessment

Jupiter has closed three funds in the past year after finding the interests of its investors could be "more effectively" served through other products. 

In its inaugural assessment of value report published today (July 31) the fund house giant said it had closed three funds following reviews of their performance in the past year.

Two of the funds, Jupiter Enhanced Distribution and Jupiter UK Alpha, closed belatedly this month after Jupiter Strategic Reserve was shut in May last year. 

Jupiter's report, which was referenced until the end of March, also stated it had reduced the ongoing charges figure for 21 of its 40 funds, which it claimed benefitted around 42,000 investors.

Jupiter also introduced 69 new unit classes with a reduced annual management charge for 49,000 direct investors who were previously invested in legacy unit classes. 

Experts have previously predicted the new City-watchdog rules which mandate annual assessments of value would see fund houses stamp out the commission paid to advisers via funds in legacy share classes.

Jupiter said 64 of its 91 unit classes had demonstrated value or consistently demonstrated strong value over the five-year period to March 2020. 

But Jupiter said its long-term capital growth had been "significantly affected by the pandemic".

The fund house said: "At the start of the year, prior to the impact of the global pandemic on markets, 100 per cent of Jupiter’s funds had delivered long term capital growth.

"In contrast, 68 per cent of Jupiter’s funds had delivered long term capital growth to their investors over the five years, to the end of March 2020."

As part of the Financial Conduct Authority’s asset management review, fund houses are now required to carry out an annual assessment of whether the firm provides value for their clients.

The value rules — which have been in effect since the start of 2020 — require asset managers to look at their performance, costs, economies of scale, comparable market rates, services and share classes.

The mandated reports have already triggered Artemis, M&G and Aviva Investors to make changes to their fund ranges and charges.

Earlier today Baillie Gifford revealed it had shut down its two active gilt funds after it discovered the portfolios were not providing value to investors

Others, such as SJP, Vanguard and Hargreaves Lansdown, have insisted their funds deliver good value.


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