The fund fees that are charged for investors in Austrian retail funds have not changed significantly as of the reporting date of 31.12.2019 compared to the end of 2018. The average maximum management fees[1] stand at 1.23%, the ongoing annual costs 1.14%, and the maximum entry charges when purchasing units in funds stand on average at 3.60%. These are the findings of the FMA’s annual “Market Study on Fund Fees charged by Austrian Retail Funds” which was published today, and which has analysed the legally prescribed information contained in Key Investor Information Documents (KIIDs) as well as the fund regulations for 1,035 funds with a total volume of more than € 101 bn as of the 31.12.2019 reporting date. The study presents the key figures in a tabular and easy to understand manner, in detail and broken down by fund type, investment strategy as well as risk class, and also offers a comparison with European key figures.
The greater the risk, the higher the fund fees
There are significant differences between the various different investment strategies and risk classes. Short-term bond funds have the lowest charges on average by investment strategy, following by bond funds, real estate funds, mixed funds and equity funds. For example the maximum management fees for bond funds stood on average at 0.98%, and for equity funds at 1.60%; the ongoing charges stood at 0.66% and 1.71% respective, while maximum entry charges stood at 3.41% and 4.25% respectively, which there only being barely discernible changes in comparison to 2018. The connex between the risk class and fee level remains significant: the higher the risk, then the higher fund fees also tend to be, although there is also a connex to the investment strategy. Funds with a focus on sustainability[2] display marginally lower fees in comparison with the market as a whole.
FMA enhances transparency
Our market service provides investors with the possibility to compare on the basis of the details contained in the mandatory Key Investor Information Document to compare the fees for a specific product against the average for that category of investment, as well as with the cost structures of other investment categories or risk classes,” remarked the FMA’s Executive Board, Helmut Ettl and Eduard Müller. “We are ensuring market transparency and are also helping the consumer to reach a tailor-made decision for their investment requirements.”
The study also presents the results of an analysis by the European Securities and Markets Authority (ESMA) that shows that the fund fees in Austria, of 1.2%, are somewhat lower than the European average of 1.5%. The fees for bond funds are considerably lower than the European average (0.7% cf. 1.1%), the same for mixed funds (1.6%) and for equity funds somewhat higher (1.9% cf. 1.7%). The fees in Austria are around the same as those in Austria.
The full “FMA Market Study 2020 on Fees charged by Austrian Retail Funds ” can be found on the FMA website (www.fma.gv.at) under: https://www.fma.gv.at/en/fma-spotlight-on/fees-charged-by-funds/
Journalists may address further enquiries to:
Klaus Grubelnik
+43/(0)1/24959-6006
+43/(0)676 88 249 516
[1] in terms of the volume-weighted average
[2] Sustainable retail funds in accordance with Austrian Ecolabel 49 for Sustainable Investment Products.