Gosling's Grouse: Closet compensation

Critics of active investing had a field day recently when the FCA announced a group of investors were getting £34m in 'compensation' from so-called closet tracker funds.

The investors had apparently been 'misled' into paying an 'active' management charge for a portfolio which effectively tracked the index. But so much about this whole episode, as part of the ongoing onslaught, misleads investors about what they should expect. Let us start with fund objectives. They have, for decades, been pointless and, as compliance increasingly dominates the industry, they have become so bland and woolly as to be rendered meaningless. Gosling's Grouse: The art of persuasion in investment What is the objective of a portfolio of FTSE 100 stocks? Many will tell y...