Master trust expense a ‘myth’
Corporate master trusts are generally less expensive for members than corporate funds, Deutsche Asset Management head of corporate super, Ken Lockery, told today’s Corporate Superannuation conference in Sydney.
Lockery described the “often promoted” notion that corporate funds were cheaper than outsourced master trusts as “a myth”.
“Like not for profit funds, many corporate master trusts have no agent fees or commissions and similar (or lower) service provider costs due to economies for scale,” he says.
“The trustees of a corporate fund may be not-for-profit, but the same could not be said of its administrator, investment managers, lawyers, consultants and the like.
“While it is fair to say that industry funds are generally cheaper than master trusts, they also typically provide far fewer services. On the other hand, most corporate master trusts are in fact cheaper than most stand-alone corporate funds and provide more services.”
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