Friends First Magnet Portfolio

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Olympian

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Has anyone any views on the new “Magnet Portfolio” product from Friends First? My mother has a lump sum sitting on deposit and it seems to offer a reasonable diversification. She also has other assets.

More information here http://www.friendsfirst.ie/Magnet_Portfolio.shtml

The breakdown is –

7% bonds
3% cash
15% UK property
10% Irish property
15% International equities
30% High yield euroland equity
10% Emerging Market equity
10% Currency fund

She doesn’t need access to the money any time in the near future so could invest for a period of at least 7 to 10 years. However since she’s a widow I think a pure equity play would be too risky.

The management change is 0.95% which seems pretty competitive compared to most other products available here. It’s an open ended fund with no early encashment penalties (I think)

I am a bit concerned that as 10% of the fund is invested in emerging markets and another 10% in a currency hedge fund this might push the risk profile of this a bit too high and maybe I should look for a more conservative product.
 
Olympian said:
The management change is 0.95% which seems pretty competitive compared to most other products available here. It’s an open ended fund with no early encashment penalties (I think)
Click to expand...

Hi Olympian,

The management charge is low but they mess the rest of the charging structure up with different allocation rates, early encashment charges and plan management charges. There are also performance related charges on the currency portion of the investment.
 
F. Kruger said:
...they mess the rest of the charging structure up with different allocation rates, early encashment charges and plan management charges. There are also performance related charges on the currency portion of the investment.
Click to expand...

Thanks. Is this typical of most multi-manager funds or somethign particular to the way Friends First have arranged this?

Would a fund managed directly by an investment manager have a more transparent structure e.g. Eagle Star, Standard Life or BIAM?
 
Those early encashment fees are determined by the broker (they allow investment manager to recoup commissions etc) - if the broker is on a commission you will be whacked by those charges no matter which investment manager you go to, unless you can get them to cut a nil commission deal.
 
Surely there are property based unit linked funds that have a simpler charging structure - e.g. w% on each contribution, x% annual management fee, y% allocation rate (if not simply 100%), z% early encashment fee (if applicable) and that's it?
 
None of the bumpf from FF seems to mention the term unit linked fund as far as I can see. Either way my point is that surely there are similar funds with clearer charging structures?
 
It has a very simple charging structure if accessed through a non-commission fee-based broker, 100% allocation, 0.95% fund management charge.

Only complication is a performance fee charged by Alder Capital (currency element only about 10% of the fund).

Potential higher allocation rate if investment > €50K.

Can't ask for simpler than that I would think.
 
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