JPMAM unveils plan to offer three share classes post-RDR

JP Morgan Asset Management has outlined its plan to offer three share classes post-Retail Distribution Review (RDR) in the UK and has placed the onus on advisers to pick the right share.

The group will offer the ‘A’ share class, which will carry a typical annual management charge (AMC) of 1.5%. It will be available to direct retail investors and to advisers eligible for commission, such as non-advised or legacy business.

They will also offer a ‘B’ share class with a typical AMC of 1%. It will be ‘clean’ of commission and available to advisers placing business directly with the group, and to platforms or nominees, including providers that want to receive a platform inclusive fee.

The minimum investment for this share class is £1m but the group said it would work with intermediaries on a case-by-case basis and would waive the minimum.

Finally, the ‘C’ share class will be ‘clean’ of commission, with a typical AMC of 0.75%, and is available to investors and platforms who do not want to receive a platform inclusive fee. The minimum investment of £5m is waived if the adviser goes through a platform, in which case the minimum would £1000.

The ‘C’ share class is in line with other providers, such as Schroders, Henderson Global Investors, Newton, BlackRock and Rathbones, which have also launched an RDR-ready share class of 0.75%.

Mike Parsons, head of UK retail sales at JP Morgan Asset Management, said the group was mailing out the details of the share classes to intermediaries, and advised intermediaries to note an amendment to the terms of business.

He said it letter would place the onus on advisers to identify the correct share class for the business they place for their clients.

“All other retail fund groups will be writing to advisers very soon informing them of their RDR share class terms and potentially amending their terms of business,” he said.

“Advisers are likely to receive a blizzard of notification letters, and with no industry standard for naming share classes, advisers will need to acquaint themselves with each group’s offering.”


This article was first published on Investment Week

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