Fees and expenses

Understand the fees and expenses for Fisher Funds Managed Funds.

What are the fees for Fisher Funds Managed Funds?

Fisher Funds charges a fee to actively manage your investment in the Fisher Funds Managed Funds Scheme.

The table below shows the charges for each fund including GST. The annual fund charges are based on the fees and expenses from the 31 March 2021 audited financial statements. They are a reasonable estimate of the annual fund charges that are likely to be charged in the future.

Mixed asset portfolios

Investment option

Fixed Management Fees

Estimated Costs and expenses

Estimated Performance-based fees*

Total estimated annual fund charges (% of net asset value)

Potential range of performance-based fees

Conservative Fund

1.11%

0.19%

n/a

1.30%

n/a

Balanced Strategy

1.20%

0.18%

0.00%

1.38%

0% to 1.20%

Growth Fund

1.27%

0.17%

0.00%

1.44%

0% to 2.00%

  • *

    The annual fund charges for the Growth Fund and Balanced Strategy include a performance-based fee estimate of 0% based on the long term average performance of the market indices used to measure the performance of the Growth Fund compared against the long term performance of the hurdle rate (see page 12 for a description of the hurdle rate). The performance-based fee is capped at 2% of the average net asset value of the Growth Fund per year (and therefore 1.20% in the Balanced Strategy).

Sector investment options

Investment option

Fixed Management Fees

Estimated Costs and expenses

Estimated Performance-based fees*

Total estimated annual fund charges (% of net asset value)

Potential range of performance-based fees**

Income Fund

0.76%

0.16%

n/a

0.92%

n/a

Property & Infrastructure Fund

1.27%

0.26%

0.00%

1.53%

0% to 2.00%

New Zealand Growth Fund

1.27%

0.13%

0.32%

1.72%

0% to 2.00%

Australian Growth Fund

1.27%

0.15%

0.04%

1.46%

0% to 2.00%

International Growth Fund

1.27%

0.15%

0.00%

1.42%

0% to 2.00%

  • *

    Performance-based fees are estimated. Where applicable, the annual fund charges include a performance-based fee estimate based on the long term average performance of the fund's appropriate market indices compared to the long term performance of the hurdle rate of return of the fund.

  • **

    A 2% performance-based fee cap was introduced on 1 July 2021. From this date the maximum performance-based fee payable is 2% of the average net asset value per year.

Prior to 1 July 2021 there was no limit to the maximum performance-based fee payable. The highest historic performance-based fee paid in each fund since the introduction of that fund’s current hurdle rate of return and the corresponding annual returns after fees were:

- Property & Infrastructure Fund performance-based fee 2.28%, corresponding annual return after fees 24.25%

- New Zealand Growth Fund performance-based fee 2.90%, corresponding annual return after fees 37.05%

- Australian Growth Fund performance-based fee 2.80%, corresponding annual return after fees 32.60%

- International Growth Fund performance-based fee 3.50%, corresponding annual return after fees 38.64%

Performance fee

We believe performance fees are a good way of aligning our interests with yours to achieve great investment returns and grow your retirement savings.

Here’s how the performance fee works:

Element

Description

Fee Structure

Hurdle rate of return

The return* that must be achieved before a performance fee begins to apply.

The average Official Cash Rate (OCR) + 5% (at May 2022 = 7.00%). Note that in the Property and Infrastructure Fund the hurdle rate of return is the average OCR + 3%.

Fee on return above the hurdle rate

The amount of the return above the hurdle rate of return that is paid to Fisher Funds.

10% (members receive 90%).

Performance fee cap

The maximum performance fee that can be paid to Fisher Funds in any year.

2% p.a. of Average Net Asset Value of Growth Fund.

High Water Mark

Where the portfolio value goes up and then down over multiple periods, this ensures that no performance fee is payable if the Manager has previously been rewarded for that performance.

No reset allowed. Where the 2% cap limits the performance fee, the High Water Mark will be set at the performance level at which the cap was triggered. This means the Manager will not be rewarded for the same performance twice.

Fee frequency

How often the fee is paid.

Annually.

For full details of the performance fee formula, see the Scheme's Governing Document.

  • *

    "Return" means the increase in the unit price of the funds, which is after management fees but before deducting any PIE tax that may be payable by individual investors.

What does this look like in practice?

Subject to beating the hurdle rate of return and the unit price being above the High Water Mark, we are entitled to earn a performance fee of 10% of excess returns. This means that at an OCR of 2.00% (as it was in May 2022), using the Growth Fund as an example, we would receive no performance fee on the first 7.00% of your return (after all other fees). But for any return achieved in excess of 7.00%, members would receive 90% and Fisher Funds would receive 10%. (up to a maximum of 2%) The table below shows how the returns achieved by Fisher Funds would be shared assuming a 7.00% (OCR of 2.00% + 5%) hurdle rate of return:

Investment Return (after the deduction of annual fund charges)

Member share

Fisher Funds share (performance fee)

Total Fee (Annual fund charge + Performance fee)

7.00%

7.00%

0.00%

1.44%+0% = 1.44%

10.00%

9.70%

(10%-7.00%) x10% = 0.30%

1.44%+0.30% = 1.78%

15.00%

14.20%

(15%-7.00%) x10% = 0.80%

1.44%+0.85% = 2.24%

20.00%

18.70%

(20%-7.00%) x10% = 1.30%

1.44%+1.35% = 2.74%

25.00%

23.20%

(25%-7.00%) x10% = 1.80%

1.44%+1.85% = 3.24%

30.00%

28.00%

2.00% cap applies

(1.44%+2.00%) = 3.74%

In the case of the Property and Infrastructure Fund the hurdle rate is the OCR +3%. The performance fee paid to the Fisher Funds and the total fee charged to clients would be higher in that fund as a result. As a reminder the High Water Mark also remains in place to ensure we are not rewarded for the same performance twice.

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