Peche drops nuclear bomb on SA Performance Fee rip-off, names Allan Gray, Coronation, Ninety-One.

 

After his recent expose’ on the massively underperforming, but big fee charging Balanced Fund unit trusts, Ranmore Funds founder Sean Peche has taken his attack on money management ripoffs to a new level. The highly qualified asset management insider (CA, CFA) describes results of a lengthy and thorough investigation into unit trust Fact Sheets and in particular the Performance Fees charged in SA, as a “Nuclear Bomb” compared with his Balanced Funds “Scud Missile”. He notes that Performance Fees on retail funds are a uniquely South African feature, having been abandoned elswhere by competition and regulator action. Peche took BizNews.com's Alec Hogg through a presentation where he lays out the shocking results uncovered by his research. It shows, inter alia, that SA’s Big Three asset managers – Allan Gray, Coronation and Ninety One – are generating billions in unwarranted fees through applying self-serving self benchmarks to deliver huge “Performance Fees” - in some instances even when they have been losing money for investors.