Asset Managers Face Pressure From FCA to Justify High Fees
- Financial Conduct Authority study looked at competition, costs
- FCA proposing ‘all-in’ fees for investors, more transparency
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“Weak” price competition in the U.K. asset management industry is leading to investors paying higher fees and charges that aren’t justified by bigger returns, the Financial Conduct Authority said following a year-long review of the industry.
The study found actively managed funds face the least price competition, though there were examples of poor value for money in passively managed funds as well, the regulator said Friday in a summary of its interim findings. The FCA also found there are conflicts of interest with institutional investment consultants, who often weren’t effective in identifying fund managers with better performance records.