What is the ongoing charge figure in investment funds?
The ongoing charge figure (OCF) is a measure of the total costs associated with owning an investment fund. It includes the annual management charge (AMC), as well as other operating costs, such as custody fees, administration fees, and marketing fees. The OCF is expressed as a percentage of the fund’s assets, and it is typically calculated on an annual basis.
The OCF is an important factor to consider when choosing an investment fund, as it can have a significant impact on your returns. In general, funds with lower OCFs are more cost-efficient, and they will generally provide you with better returns over the long term.
What costs are included in the OCF?
Here are some of the things that are included in an OCF:
- Annual management charge (AMC)
- Custody fees
- Administration fees
- Marketing fees
- Other operating costs
Here are some of the things that are not included in an OCF:
- Transaction costs
- Performance fees
- Initial charges
The OCF is a useful tool for comparing the costs of different investment funds. However, it is important to note that the OCF is not the only factor to consider when choosing a fund. You should also consider the fund’s investment strategy, performance history, and risk profile.
TIps for comparing OCFs
Here are some tips for comparing OCFs:
- Look for funds with low OCFs.
- Compare OCFs on a consistent basis.
- Consider the fund’s investment strategy, performance history, and risk profile.
