MERRILL LOSES PERFORMANCE FEE VOTE
By STEPHEN MARRIOTT 01/12/2005
Further to our commentary on 18 November, Merrill Lynch lost yesterday’s vote to introduce a performance related fee on its UK Absolute Alpha fund.
This is good news. The proposed fee appeared to be in no-one’s interests other than Merrill’s. Had it been introduced, the break-even point (at which the proposed fee arrangement matched the existing one) would have resulted in a net return to investors of only just over 3% per annum. Bestinvest discretionary managed clients own a significant proportion of the trust and voted AGAINST the proposals.
We gather Merrill Lynch is going back to the drawing board to formulate a new proposal. A performance fee that kicks in only after an agreed ‘hurdle rate’ has been exceeded would make a lot more sense.
Market latest
|
Index
|
Points
|
+/-
|
| FTSE 100 |
5338.38 |
1.24%
|
| FTSE 250 |
10593.00 |
0.77%
|
| FTSE All Share |
2776.65 |
1.17%
|
| FTSE Euro 100 |
2025.68 |
1.17%
|
| S&P 500 |
1314.49 |
0.78%
|
| Nasdaq |
2841.98 |
1.12%
|
| Hang Seng |
19200.93 |
0.31%
|
| Nikkei 225 |
8876.59 |
0.86%
|
Values delayed by at least 15 minutes.
Source: Financial Express