Statement of Investor Rights

CFA 3

The Institute of Chartered Financial Analysts (CFA) has published what they believe to the be 10 key rights that investors must be entitled to when purchasing financial services products.

Millen Capital are a staunch advocate of these 10 investor rights. We would suggest that investors pay particular attention to the 8th right: ‘An explanation of all fees and costs charged to me, and information showing these expenses to be fair and reasonable’.

Numis securities recently published a piece of independent research, which analysed the all-in fees charged by big-brand wealth managers – traditionally a very opaque part of the industry.  Their analysis shows that the majority of the big-brands charge more than 2.0% per annum for their wealth management service.

We believe it is extremely important to consider the impact fees have on future wealth.  Investors must fully understand how much they are paying their wealth managers and what they are paying for. £100,000 invested in the FTSE 100 ten years ago would now be worth £203,245 (returns of 7.35% pa). Once you take 2% pa fees into account, you would have £168,401, having paid £34,844 in fees!

We would therefore suggest that investors ask their current investment advisers to disclose the following 3 key bits of information relating to what fees they are paying for having their money professionally managed :-

  1. What annual % fee am I paying for Custody and Dealing?
  2. What annual % fee am I paying for fund fees (both internal and external funds)?
  3. What annual % fee am I paying for advice?

Our Apex Wealth proposition is built on a robust evidence based investment philosophy and transparent fee structure.

Please contact us if you would like a free Independent appraisal on your portfolio