The study of cross-border fund charges conducted by the London-based research company found 79% of asset managers subsidise their own funds to keep total charges under control, as pressure has grown to cap fees to remain competitive.
Nearly a fifth of those subsidising their funds were covering expenses that significantly exceeded the management fee.
Smaller funds experience the biggest pressure on fees with both retail and institutional funds of less than $10m (£7.7m, €8.9m) reporting operating costs that were more than double the charges.
For example, an average institutional fund valued at less than $10m would charge around 1% OCF, but would be subsidised a further 2% by the manager to cover costs.
Larger funds of more than $100m were evidence economies of scale worked in their favour with a minimal subsidy needed, if any at all, as charges covered most costs.
