Multimanager SEI and UK equity manager Liontrust have parted ways over the issue of performance fees...
Multimanager SEI and UK equity manager Liontrust have parted ways over the issue of performance fees.
Last week, SEI said it would no longer use Liontrust as an underlying manager in its UK equity strategy. It stated at the time the Liontrust mandate had not underperformed its benchmark.
In the past two years, Liontrust has gradually been moving towards a performance fee-related remuneration structure for the institutional mandates it runs.
In 2000, when Liontrust started running money for SEI, the UK boutique had not switched across to this model. Investment Week understands the agreement between SEI and Liontrust came to an end because SEI does not offer performance fee arrangements with managers.
In 2002, Liontrust won £1.4bn in pensions fund business and the majority of these mandates are run on a performance fee basis. The basic structure is for a 0.25% per year charge with a performance fee on top, which is a percentage of outperformance of an agreed benchmark.
As SEI does not run performance fees with managers on its platform, the group decided not to renew its initial contract with Liontrust, which ended on 26 February.
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