CityWire.co.uk – Multi-manager specialist T Bailey is to pay the fixed costs of its new Cautious Managed fund to ensure early investors are not penalised by their impact while the fund gains critical mass.

Fixed costs on the new fund – such as audit fees, regulatory charges and trustee costs – are expected to add up to between £10,000 and £15,000 a year. On a £10 million fund, a likely size for the fund during its early days, the costs would produce a 10 to 15 basis point drag on performance.

T Bailey’s Citywire AA-rated fund of funds manager Jason Britton, who will be managing the new fund with colleague Richard Martin, told Citywire: ‘It’s unfair for early investors to suffer this performance drag. It’s like asking people to pay more for giving you their support.’

Britton said the money will come from the marketing budget. ‘I find it amazing what other groups will spend on advertising but not helping out real investors,’ he said.

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