Unit trusts and OEICs are permitted to charge certain expenses to the fund. So the true annual cost is higher than the annual management charge.
The TER adds all the costs declared by the fund manager, including the annual management charge, in the latest annual fund report and expresses them as an annual percentage charge. It is important to note that the TER takes no account of any initial charge when you make an investment.
Our Model Portfolios can help you choose your fundsThe TER gives the most accurate available guide to the total cost of having your money managed in the relevant fund. The TERs we quote are taken from the Investment Management Association website and are calculated by Fitzrovia International.
Funds with a * are ‘funds of funds’ that invest in other unit trusts/oeics. In this case the TER shown in our table is only the charge of the fund itself and does not include the annual charges of the funds in which it invests. Typical TERs for Funds of Funds are 2%.
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