Trusts race to cut fees as pressure from clean pricing gathers pace

Leading investment trusts are racing to scrap performance fees as the move to clean pricing in the open-ended space puts pressure on charges.

Since the £1bn City of London trust removed its performance fee in July, a host of other closed-ended vehicles have followed suit as trusts try to compete with cheaper open-ended rivals. In total 12 major trusts have dropped performance fees recently, including International Public Partnerships, Henderson International Income, and British Empire, and more look set to follow by the end of the year. Specialist portfolios J.P. Morgan Asset Management, the UK’s largest investment trust manager, is one group in discussions with boards on performance fees, which can run up to 20% of any o...