Charges

Charges and costs 

Paid by investors 

Ongoing charge (including the Annual Management Charge) 

This covers the Schroders Annual Charge, costs for holding underlying funds and extraordinary costs. It does not include payments to your financial adviser and/or any other firm through which you invest. You pay for these services directly. 

Yes 

Portfolio transaction costs 

These are the expenses incurred by the fund when buying and selling assets on behalf of its investors. Portfolio transaction costs are made up of the broker commissions and stamp duty incurred as a necessary part of buying and selling the funds’ underlying investments in order to achieve their investment objectives. In the case of shares, portfolio transaction costs are paid by the fund on each transaction. 

Yes 

Entry charge 

Otherwise known as ‘initial charge, this may be taken from your money before it is invested. From 1 Jan 2013, it does not include commission to advisers, but platforms or execution-only brokers may take a percentage. 

No 

Exit charge 

May be taken before the proceeds of your investment are paid out. Very few funds will have an exit charge. 

No 

Performance fee 

Performance fees are charged separately as a way of rewarding the investment manager for superior returns or for outperforming specified targets. Schroder UK Dynamic Absolute Return fund is the only fund that currently charges a performance fee. 

One fund only 

Our funds are all single priced - with a single priced fund there is a single price for buying and selling units or shares in the fund on any one dealing day. Single-priced funds can swing the single price of a fund unit upwards when there are more buyers than sellers of fund units or shares or downwards where there are more sellers than buyers of fund units or shares. 

Dilution - investors in a fund can be adversely affected by other investors subscribing or redeeming from a fund. This effect is known as dilution. Dilution occurs when large deals in and out of a fund cause the fund manager to buy or sell the underlying investments of the fund thereby attracting trading costs which are borne by the investors in that fund. 

Swing pricing - is a mechanism to reduce dilution and protect ongoing investors. It aims to ensure that investors subscribing or redeeming from a fund bear a portion of the trading costs, i.e. the underlying spreads and transactions costs. Each fund has a swing factor, also known as a anti-dilution adjustment, which is an estimate of the underlying dealing spreads, transaction charges, and taxes.