Fairstone is converting four of the portfolios in one of its MPS ranges into funds and cutting client charges by up to 20%.
Four low-cost portfolios in the Fairstone Systematic Powered by Dimensional MPS range have been unitised on the back of their success, the wealth management group said, with their assets transferred into the four new multi-asset funds.
These portfolios are now known as the IFSL Fairstone Systematic funds and have combined assets under management of around £600m.
Fairstone expects the ongoing charges figure (OCF) for the portfolios to be cut by around 20% from between 0.42% and 0.43% to a target of between 0.33% and 0.34% for the new funds. In addition, the funds will offer Capital Gains Tax benefits for investors holding them outside a SIPP or ISA.
The two remaining Systematic MPS portfolios – with combined assets of around £10m – will see their discretionary fund management (DFM) fees fall from 0.15% to 0.07%. As a result, their total costs also fall, with Fairstone Systematic Powered by Dimensional Risk Level 3 falling from 0.41% to 0.33% and Fairstone Systematic Powered by Dimensional 8 falling from 0.44% to 0.36%.
Marlborough Group’s Investment Fund Services (IFSL) has been appointed as the funds’ authorised corporate director (ACD) to help launch the funds and provide oversight to protect the interests of investors.
Dimensional Fund Advisers will act as sub-investment manager for the funds, with responsibility for day-to-day investment decisions.
Nick Stebbing, chief product and proposition officer at Fairstone, said: “This evolution underlines Fairstone’s role as a professional buyer, using our scale, structure and buying power to secure better outcomes for advisers and clients, and continually improving where we can.
“We’re very pleased with how the whole process of launching the funds has gone. IFSL and the wider Marlborough Group are respected names in the industry and, as well as their breadth and depth of expertise, the team have been great to work with and have a real ‘can do’ approach. We believe they’re a strong partner to support Fairstone as we continue our growth story.”
Martin Ratcliffe, Co-CEO of Investment Fund Services, said: “We’re delighted to have been selected by Fairstone to help them launch their new funds. Now they’re up and running, we’ll continue to work in partnership with the team at Fairstone, providing expertise and oversight to help safeguard the best interests of the funds’ investors.”
