A look at fees and commissions

The terms used to cover the payments an investor makes to an adviser are straightforward, aren't they? Commission is a sum paid by a service (product) provider to an agent (adviser) in return for the performance of a particular service by the agent (adviser). And a fee is a sum paid by the recipient of a service to the provider of that service. If only it were that simple. Take the following scenario. Adviser A sells an investment of £100,000 to a customer and agrees with that customer to take an annual fee of 1.5% plus VAT of the portfolio value every year. Adviser B sells the same i...