The FSA Spy market buzz – 13 December 2024
M&G’s positive outlook; Wisdom from Schroders’s podcast; Alliance Bernstein on the power of curiosity; Janus Henderson on responsible AI; China’s retirement revolution; Apple and much more.
HEAD-TO-HEAD: Alliance Bernstein vs Fidelity
FSA compares two global fixed income products: the AB Global Bond Portfolio Fund and the Fidelity US Dollar Bond Fund.
Fees
The AB fund has the uncomfortable distinction of charging the highest fees in the sector. Its OCF of 2.48% seems excessive “for such a short duration fund mainly invested in low-risk government securities”, said Ng.
The fund’s consistent underperformance against its benchmark and its five calendar years of negative annual returns also suggest that a reduction in its fees would be appropriate.
The Fidelity fund’s ongoing charge (OCF) is 1.06%, which is comfortably below the 1.19% median charged in the US dollar bond sector, but still well above several funds with similar allocation weightings to US Treasuries.
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