Navra Fund Performance Fee

TakeStock · 18-08-2005, 07:50 PM

I understand how the performance fee is calculated (percentage of outperformance of ASX200), however, I don't understand when it is taken from the fund and where it goes. I note that it changes daily (as would be expected). When is the performance fee paid to the fund manager - daily, monthly, quarterly or yearly?

I am thrilled with the fund's performance, and as a shareholder, I am happy with the performance fee (much fairer than a set management fee).

Cheers

Sim · 18-08-2005, 09:14 PM

From the NavraInvest website:

http://www.navrainvest.com.au/index.asp?content=fee

Quote:

On each day the accumulated daily return of the Funds and of the growth of the Index will be measured from 1 July each year (except at the commencement of the Funds when the commencement date will be used). The performance fee will be calculated and accrued in the Funds’ accounts on a daily basis.

For the purpose of calculating the performance fee, the return of the Fund is based on the percentage increase or decrease in the gross unit price of the Funds (before deducting the performance fee) over the period of the performance fee calculation (i.e. from 1 July to the date of the calculation)

So - the answer is daily - but is also adjusted daily (downward if necessary).

There is another important paragraph on that page that's worth highlighting.

Quote:

When the funds are underperforming, the funds are not deducting any performance fee which aligns our fee structure to our stated aim of management fees, which are purely performance based. When the funds are out performing then we build the performance fee into our daily unit price so that the treatment is fair and equitable to all unit holders as they buy into and sell out of the Funds at any point in time.

TakeStock · 19-08-2005, 04:13 PM

Thanks Sim.