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OUTvest - how does its fee structures compare?

16 January 2020 8:29 PM
Tags:
investing
unit trusts
OUTvest

What does it really cost you to have your investment managed by somebody else? What is that management worth in the end?

Few investors actually see the real nominal amount they are paying to investors and investment services.

Fees are simply deducted from the investment return - and to most investors it is difficult to even see that they have gone.

Investing costs money - but it's complicated to calculate the costs of your investment.

The Money Show spoke to Grant Locke, head of OUTvest, and Warren Ingram, wealth manager.

Kahn Morbee, (from the band the Parlotones) said during an interview with you that investment fees are so difficult to understand. I actually wanted to get out of the car and phone you and say hey we're working on this, wait for it. We recently launched it - and it's called the OUTvest One fee. When you use a percentage-based fee it's very difficult for anybody to understand what the investment costs - we think in rand and cents. So three per cent does not sound like a lot of money but over 30 years it is an incredible amount of money. You never see all of your fees on one statement on one charge. We've approached it from a different angle. That's the revolution - we're trying to change the thinking about this.

Grant Locke, head of OUTvest

Let's talk about the unit trust industry as an example. They're charging their client the same percentage whether the client invests a thousand rand or ten million rand - so those become massive profitable things for asset managers to run. Now Grant and his team have said; we're going to turn this thing on its head - your going to pay four-and-a-half thousand rand that's it - the cost is the cost. This is shots fired. When I first investigated, I asked what's the too-good-to-be true factor about it. I looked hard - you know I'm the sceptical sort, but there's no crookery here. I'll give you the criticism now, nothing is perfect...

Warren Ingram, wealth manager

Listen to the full interview about the pros and cons below.

Get the 10 most-read articles of the week from Bruce Whitfield’s The Money Show, emailed to you every Friday morning.


16 January 2020 8:29 PM
Tags:
investing
unit trusts
OUTvest

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