Report slams ‘murky world' of DFM pricing

Discretionary fund managers are failing their customers by adopting opaque and expensive charging structures, according to a new report.

Analysis of the DFM market for Skandia by consultancy the lang cat compared the total cost of ownership (TCO) for clients using one of five similar DFM services on seven different platforms. It found wildly differing prices of up to 70bps, with some of the most expensive offerings topping 1.85%. Lang cat principal Mark Polson (pictured) said DFMs had escaped the downward pressure on price seen in the rest of the investment industry. “TCO is a hard beast to pin down but, when you do, you can find some wildly varying results,” he said. “We are quite used to dealing with opacity in...