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Fidelity cuts index tracker charges for UK retail investors

27th May 2014 Print

Fidelity Worldwide Investment has announced that it is lowering the cost of index tracker investing by further cutting charges across its newly launched equity index range. Fidelity has become the price leader in the UK retail market across the seven most popular indices.
The new pricing, available directly through Fidelity Personal Investing, via advisers using FundsNetwork and to selected wealth managers, is based on a fixed total ongoing charge at 0.07% p.a. for the Fidelity Index UK fund and 0.08% p.a. for the Fidelity Index US fund.
The range of seven funds, covering the UK, US, Europe, Japan, Pacific Ex Japan, Emerging Markets and World, is also being extended to other platforms with market leading pricing at 0.09% p.a. for its UK tracker and 0.10% p.a. for its US tracker - well below most of its major competitors [see table].
Fidelity’s move makes it the lowest cost provider of index tracker funds available to UK retail investors today. The average ongoing charge for a UK tracker from one of the four leading providers stands at 0.16%. In addition, over £7bn of UK savings still sits in UK trackers with ongoing charges of 1% or more.
Commenting on the move, John Clougherty, Head of UK Retail at Fidelity Worldwide Investment, said: “Index trackers sit at the core of many investment portfolios and while charges have come down over time, there are still many that are poor value for investors – in fact there is £7 billion of investors’ money still sitting in funds that charge 1% or more.”
He added: “We know that investors want choice and value when it comes to investing, whether that’s through an active fund, a tracker or both. With these price cuts, Fidelity is offering the best value index trackers available to UK retail investors today.”