Aegon study highlights impact of fund fees and complexity on returns

Passives fare better than active funds over long term

Newly published analysis by Aegon shows that simpler and cheaper investment solutions tend to offer better returns over the long term.

Aegon examined the risk and return profile of funds from the two largest Investment Association (IA) Mixed Investment sectors and compared those using mainly passive components to those using mainly active ones over five years. It found that multi-asset funds with passive components provide better risk-adjusted returns than those with active components over a five-year period. Spot the Dog: Underperfoming funds cost investors £410m a year in fees The main reason for this is that fund charges can erode returns over the long term, having a significant impact on the eventual payout fo...