A management fee of 0.75% per annum on the value of the Company’s total assets, less current liabilities other than borrowings for the purpose of investment, calculated monthly in arrears. In determining the total assets on which the management fee is calculated, the value of any securities held by the Company in collective investment schemes managed by the Manager are excluded.
A performance fee will be charged when the Net Asset Value (NAV) percentage increase over the year is greater than the percentage increase in the Benchmark Index in sterling and total return terms, plus a hurdle of 1% (the rate over which a performance fee is payable). The Manager will be entitled to 15% of the NAV outperformance of the Benchmark Index above the hurdle (excluding the effect of share buy-backs), subject to the maximum amount payable in any one year in respect of the management fee and the performance fee being 1.75% of net assets at the year end.
Underperformance will be carried forward and must be made up before any further performance fee can be paid. Any excess performance will be carried forward and can be set against underperformance but not used to earn or enhance a performance fee payment.
Morningstar calculates all expenses for the financial year, consisting of management fees, performance fees, directors' fees, administration fees, custody fees, audit fees, marketing fees, loan interest, tax, restructuring costs and all other expenses given in the Statement of Total Return and notes in the Report and Financial Statements. They subtract performance fee, restructuring costs, transaction costs, compensation scheme expenses and trail commission then calculate the average daily net assets on a cum fair basis, then divide the total expenses by the average daily net assets and multiply the resulting figure by 100 to arrive at this ratio.
Please note, not all companies have yet adopted ‘ongoing charges’ as the methodology in their Annual Report and Financial Statements. This may mean there are differences between the charges shown on our factsheets and website and the TER shown in the Annual Report.