Charges Explained

There are a few charges that may be applied to the funds in which you invest with Slater Investments. Below you will find an explanation of these costs in relation to our funds and why you may be subject to them when you invest.

 

One-off Charges

Initial Charge:

The initial charge is the maximum amount that might be taken out of your investment before it is invested in one of our funds and is used to cover the cost of setting up your investment. For example, if you invest £1,000, an entry charge of 5.25% means that £947.50 of your money will be used to buy units in a fund. The initial charge varies from class to class and is published on all relevant literature

Exit Charge:

Slater Investments does not charge any exit fees. 

Ongoing Charges

Annual Management Charge:

This charge is to cover the annual costs of running and managing the fund. They are levied as a percentage of assets, with the level depending on the class you are invested in. These are shown on the factsheet and KIID for each fund.

Ongoing Charges Figure (OCF):

The OCF covers all aspects of operating a fund during the course of its financial year. The OCF excludes portfolio transaction costs except for an entry/exit charge paid by the fund when buying or selling units in another fund and may vary from year to year. 

Independent Oversight

  • Depository/Trustee oversight
  • Safe-keeping of the fund's assets
  • Auditor's fees
  • Regulators fees

Administration

  • Customer Service
  • Keeping a record of your investment
  • Paying any income due to you
  • Sending progress reports to you
  • Telling you how much your investment is worth

Operating the Fund

  • Maintaining fund accounting records
  • Valuing the fund assets
  • Calculating the daily price
  • Producing reports
  • Complying with investment rules


Dual and Single Priced Funds


Dual Priced Funds:

The Slater Growth and Slater Recovery funds are dual priced Unit Trusts. This means they have an offer (buying) price and a bid (selling) price, the difference between these is known as the bid-offer spread.

When pricing one of our unit trust funds, we begin by calculating the creation price, which is the basic cost of creating a new unit and includes the price of buying the underlying holdings and the dealing costs, such as stockbroking commission and stamp duty. To calculate the offer price, we add any applicable initial charge to the creation price. Therefore, any party purchasing units is compensating existing investors for any dilution in the fund's value caused by underlying fund transaction costs that may result from their unit purchase(s).

The bid price at which units may be redeemed by investors is made up of the price that would be received when redeeming the underlying holdings, less any dealing costs such as stockbroking commission and stamp duty. Similarly, therefore, any party selling units is compensating existing investors for any dilution in the fund's value caused by underlying transaction costs that may result from their unit redemption.

The spread between a dual priced unit trust fund's bid and creation price is dependent on the profile of the underlying portfolio of holdings. Funds transacting predominantly in less liquid, small cap stocks, where the underlying shares are traded on a wider spread and have higher associated dealing costs, will exhibit a wider bid to creation spread than funds predominantly transacting in more liquid, large cap stocks.

 

Single Priced Funds:

The Slater Income and Slater Artorius funds are single priced open-ended investment companies (OEICs).

Shares in OEICs are bought or sold at the same single price, which is directly linked to the value of the fund's underlying investments. Therefore, there is no bid-offer spread. An OEIC fund, however, can apply a dilution levy, which can be up to 1% of the value of the amount redeemed and is paid directly into the fund. This is an explicit charge that the fund can apply to specific client redemptions and is intended to reduce the effect of dilution on the future growth of the Fund. This levy is generally used in the case of exceptionally large deals as a proportion of the size of the fund.

For an illustration of Slater Investments' charges, please click here.