AGF Lowers Fund Fees in Preparation for CRM2par Andrew Rickard | April 21 2015 08:36AM
AGF Investments has reduced management fees on a number of its fee-based Series F mutual funds.
With the increased disclosure requirements that will come into force with the second phase of the Client Relationship Model (CRM2), the fund company says it expects more advisors to switch to fee-based remuneration in order to provide clients with greater transparency. These funds are meant to help them make the transition.
AGF points to research conducted by Investor Economics which suggest that almost 45% of all money flowing into investment funds over the next decade will be paid into fee-based and discretionary accounts. "Research suggests that, even in the absence of future regulatory action, the trend towards unbundled fee-based compensation will increase due to changes in demand, competitive challenges and a need for transparency," says AGF.
The management fees on the AGF Diversified Income Class, AGF Diversified Income Fund, AGF Global Aggregate Bond Fund, and the AGF Tactical Income Fund have now been reduced to 0.90%. Last year, AGF also lowered fees on a dozen other Series F funds by 10 to 55 basis points.
"This is a growing business segment and AGF is lowering our pricing to ensure we are competitively positioned for this evolution towards a fee-based business model," says Gordon Forrester, Executive Vice-President, Product and Marketing and Head of Retail, AGF Investments Inc. "These changes are just one of the ways AGF is ensuring that advisors are prepared for the changes CRM2 will bring. We will continue to create practice development tools and resources to ensure advisors help their clients understand the importance of their professional advice."