"Post-Negotiated Fees: The New Competitive Weapon"

Post-Negotiated Fees: The New Competitive Weapon

White Paper: Investment Metrics

The Data Revolution in Asset Management

In a shifting landscape of regulatory changes and increased M&A, fees have become a top priority for institutional investors. Asset manager fee data is more important than ever, but this information is typically obscure, with data on ‘stated’ instead of ‘actual’ fees. Improved intelligence regarding fees can lead to a strong competitive advantage. Post-negotiated fee data not only allows investors to better understand the fees they are paying, but also how those fees compare against the industry. Until now, there has been no one data source for actual, post-negotiated fees.

Fee information has become a “must have” in the asset management industry amidst the ongoing push for greater transparency and comparability, and as such, asset managers will need to invest in the right technology. Data management capabilities must be increased in order to maximize distribution opportunities and cope with this new regulatory and reporting landscape.

The Need for More Comprehensive and Complete Data

Asset owners still have a hard time determining what they are actually paying for asset management. Asset managers have the ability to negotiate very different fee arrangements with different asset owners, which makes it difficult to determine if your fee structure is appropriate. And it has long been difficult – if not impossible – for asset owners to gain access to this data or to have the ability to compare fee structures. Fee data has typically been cobbled together from incomplete, infrequently updated sources that lack external validation. Until now, there has been no actual, true single source of post-negotiated fee data across major asset classes, investment vehicles and plan types.