Platform AJ Bell has announced a cut to the charge on its £33.6m Passive Balanced Fund, and said more cuts are likely.
The company announced the annual charge on its AJ Bell Managed Balanced fund will fall to 0.47 per cent, down from 0.50 per cent.
A spokesperson for AJ Bell said the cut in fees is the result of the fund growing sufficiently in size that the administrative costs of running the fund have fallen, and AJ Bell is passing those reduced costs onto its customers in the form of lower charges.
Charges on the rest of its multi-asset passive fund range are also expected to come down as they grow in size, according to the company.
The other five funds in the range will have an annual management charge capped at 0.15 per cent, but the total cost of ownership of those funds is higher than that, with the expenses of running the funds added on. The 0.15 per cent is AJ Bell’s fee.
Charlie Musson, head of public relations at AJ Bell, said the expectation is that as those funds grow in size in the years ahead, the administration costs will fall, leading to a fall in the total charges on the funds in time.
Minesh Patel, a chartered financial planner at EA Financial Solutions in Finchley London, said it is "good news cost savings are being passed back to the consumer".
"However Vanguard and L&G offer similar multi-asset funds at a lower price, with Vanguard Life strategy funds at 0.24 per cent and L&G at 0.31 per cent.”
David.Thorpe@ft.com
