10x6 Finance: le fonds sous toutes ses formes, 29 avril 2015 à Luxembourg. Intervention de Olivier Portenseigne (Fundsquare). Événement organisé par le Paperjam Club.

2. Demystifying Fund Costs
29th April 2015
Paperjam Club – 10X6 Finance

3. local
platformdistribution
efficiencycross-border
funds
costs TER profitability
assets
mutualisation
proprietary
investment
services
administration
domiciles
competitiveness
synergies
centralization
management

4. 4
We want to address two key questions

5. 405
funds
500bn
AUM
5
domiciles
• Luxembourg
• Ireland
• UK
• France
• Germany
3 asset
classes
• Bonds
• Balanced
• Equities
Our analysis relies on a representative sample of funds and we
keep adding participants

6. Average ongoing charges (%)
At first look, cross-border platforms are more expensive than
domestic domiciles
Source: Funds KIID

7. © 2015 Deloitte Tax & Consulting 7
Our objective is to identify and understand the cost drivers

8. FOCUS OF
OUR STUDY
Let’s decompose the Ongoing Charges and understand what
impacts them
100%

9. Breakdown of ongoing charges – Luxembourg domiciled UCITS
Source: Annual Statements; Deloitte expenses Database; Deloitte Analysis

10. Focus on cross-border distribution add-on cost in bps
WORK IN
PROGRESS

11. This represents between a significant portion of the market
servicing fees
Source: Annual Statements; Deloitte expenses Database; Deloitte Analysis
10-15% = 500 million

12. • 2bps means that Lux would
still be more expensive
12
Let’s have a closer look …
Equities
• So what are the issues ?
o Trailer fees: the RDR example
o Inefficiencies: the US example
o Scale: US funds are 3/4 times bigger
than in Luxembourg

13. 13
The profitable inefficiency issue
The US model
The X Border model
Retail
Retail
Retail
IFA
IFA
IFA
Brokers
Brokers
Brokers
NSCC
Funds
Funds
Funds
Retail
Retail
Retail
IFA
IFA
IFA
Banks
Insurers
Intermediaries
Platform
Platform
Platform
Funds
Funds
Funds

14. Scale: get bigger and consolidate
14
Conclusion
1
2
3
Trailer fees: regulation should help
Inefficencies: clear need of a new model