Nutmeg to shake-up fees and launch passive portfolio range

13 January 2017
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So-called “robo-investor” Nutmeg, has announced a shake-up of management fees for both new and existing customers, as well as the launch of passive portfolios.

From Monday 16 January, the fees new investors pay for Nutmeg’s 10 actively managed portfolios will change to the following:

  • On the first £100,000 invested – 0.75%
  • On anything invested beyond £100,000 – 0.35%

 

This is a move away from the current slab fee structure, where investors pay just one fee depending on the amount they have invested. This is as follows:

  • £500 - £24,999 – 0.95% 
  • £25,000 - £99,999 – 0.75%
  • £100,000 - £499,999 – 0.5%
  • £500,000+ – 0.3%

 

 

Nutmeg’s 25,000 existing customers will automatically be switched to the new system on Monday, but only if they’ll pay less. This means the following:

  • £500-£24,999 invested – Your fee will fall from 0.95% to 0.75%
  • £25,000 - £99,999 invested – Your fee will remain the same at 0.75%
  • £100,000 - £499,999 invested – You’ll continue to pay 0.5% on the first £100,000, but for everything above £100,000 you’ll pay 0.35%
  • £500,000+ invested – Your fee will remain the same at 0.3%

 

The investment company says existing customers will benefit from this “simpler management fee structure”, and adds that more than two thirds of customers will see their fees cut.   

It’s worth noting that the minimum investment will continue to remain at £500, while the additional 0.19% annual fund charges also remain for both new and existing customers. 

Passive portfolio range

In addition to its fees shake-up, from Monday 16 January Nutmeg will launch five passive portfolios alongside its 10 existing actively managed portfolios.

These will cost 0.45% on the first £100,000 invested and 0.25% on anything above this amount. Fund charges of between 0.13% and 0.22% per year will also apply.

Nutmeg says it’s the first online wealth manager to give investors a choice between funds actively managed by humans, and a passive portfolio with no human intervention to rebalance them. 

The portfolios will be globally diversified across a range of asset classes and what you’ll be offered will be based on the level of risk you’re willing to take.

Martin Stead, chief executive of Nutmeg, says: “Our new fixed allocation portfolios will particularly appeal to experienced investors with a long-term mind-set.” 

 

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