Dresdner RCM is to change the mandate of its European Privatisation unit trust, formerly Kepit, to a...
Dresdner RCM is to change the mandate of its European Privatisation unit trust, formerly Kepit, to a continental European index tracker, writes Jane Wallace.
The company is sending letters to unitholders and IFAs this week to ask for a vote on the change in investment objective. If passed, the fund will change its mandate on 20 August.
Nick Hodgson, sales and marketing director at Dresdner RCM, said: "We have decided that it is inappropriate to continue to offer the trust. Like the Mepit board, we have decided that in isolation, the privatisation story is not strong enough on its own. It is only part of the case for investment in Europe where there are several more interesting stories."
He added that Dresdner already runs two other actively managed European unit trusts, making it inappropriate to run a third. In addition, there are only three European tracker funds currently available, yet there is growing demand and interest from investors in this sector.
Annual management fees for the new fund stay the same at 0.75%. From 20 August, the initial charge for new investors will be reduced to zero. Renewal commission for IFAs of 0.5% for new Pep transfer and Isa business will also be introduced.
The new fund, to be called European Index, will be managed by Paul Kelly.
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