The fund fees that are charged for investors in Austrian retail funds have not changed significantly as of the reporting date of 31 December 2018 compared to the end of 2017. The average maximum management fees[1] stand at 1.21%, the ongoing annual costs 1.13%, and the maximum entry charges when purchasing units in funds stand on average at 3.61%. There are significant differences between the various different investment strategies and risk classes. These are shown in the study in detail and in figures. Money market funds and 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 0.99%, and for equity funds at 1.59%; the ongoing charges stood at 0.68% and 1.73% respective, while maximum entry charges stood at 3.39% and 4.33% respectively. Funds with a focus on sustainability[2] do not display higher fees in comparison with the market as a whole. These are the findings of the FMA’s annual “Market Study on Fund Fees for Austrian Retail Funds” which was published today. It is based on the analysis conducted about the information contains in the legally prescribed Key Investor Information Documents (KIIDs) as well as the general terms and conditions of funds of 1,120 funds with a total net asset value (NAV) of almost € 90 billion as of the reporting date of 31.12.2018.
Transparency, Transparency, Transparency
“Our annual market study on fees charged by funds for Austrian retail funds creates transparency. It gives consumers 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 Klaus Kumpfmüller.
The study also shows that fund fees in Austria are about the same as in Germany and well as the EU average. While Austrian bond funds have marginally lower fees, the fees of equity funds are by contrast marginally higher.
Performance-related management fees are used in approx. 5% of funds, with their being calculated after the deduction of general management fees. The models for calculating such fees, which are tied to the performance of the fund, are however very heterogeneous and may amount to up to 25% of the earnings over and about the benchmark or a comparable value.
The full “FMA Market Study on Fund Fees for Austrian Retail Funds 2019” can be found on the FMA website.
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 public funds in accordance with Austrian Ecolabel 49 for Sustainable Investment Products.