Sometimes the mgr swallows some of the expenses from his Mgt fee to make the TER more competitive (ex-Ireland obliviously).
The index I am benchmarking against is the "DJ Eurostoxx 50 Total Return" index as opposed to the corresponding "Price" index. I would imagine that for a unit fund of this nature the dealing charges for Quinn are minimal since they probably just buy (and very rarely sell) shares in an ETF. They could use the corresponding iShares EFT, for example, which has a TER of around .15%. My understanding is that this ETF would have a minimal tracking error given its size. I imagine that Quinn simply pocket an additional .85% from the fund allowing them to quote a "management charge" of 1%.On your analysis you are looking at tracking error the difference between a b/mark indices and a fund, which has a lot more to it then merely expenses. Is it replicating the underlying assets exactly or 90%? . What about dividends, WHT, cash transactions, unit fund pricing times dealing charges. What I am saying tracking error is not just the TER. . Whoever was told the TER was the annual mgt fee was misinformed. In my experience most people working in this industry don’t know what a TER is let alone the investors they are advising.
However DBX trackers have a EuroStox 50 ETF with a TER of 0.00% pa
However DBX trackers have a EuroStox 50 ETF with a TER of 0.00% pa
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This means that by using an Insurance Company you are paying a full 1%pa extra for just 50 stocks.
Is this really good value? For some people with small amounts to invest each month maybe but possibly not so clever for larger lump sum investors.
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