Fees review:
Share said the Schroders fund is reasonably priced, with its total expense ratio at 1.93% being slightly lower than the category median.
By comparison, the Value Partners fund has a high total expense ratio of 3.31%, making it the most expensive fund in the category. This steep fee includes a 15% performance fee levied on any positive returns with a high-watermark.
“Investors end up paying high fees even if the fund underperforms the markets, so long as it posts an absolute return. We think this is the key drawback of the fund and that a lower base fee would be more appropriate,” Share said.
Conclusion:
“Parbrook and his supporting team has a proven process and tested track record. The Schroders fund is one of the best options for investors seeking Asian equity exposure,” Share noted.
As for Value Partners, “we think there is room for improvement for the firm,” she said, adding that a tendency for poor disclosure practices are not in investor’s best interests.
Share added that the Value Partners fund would be suitable for investors who are seeking a fund that is particularly resilient in market downturns. This is partly due to the fund’s ability to hold bonds, which can provide some insulation during equity market downswings.
