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Choose ‘passive’ funds to minimise account charges

Irish Independent Special Supplement

Wed, Aug 5th, 2009

THE big problem with investment accounts is the charges, which can eat into your gains.

Both QUINN-life and RaboDirect have low charges. One way to keep charges down is to go for an index linked or ‘passive’ fund, rather than a more expensive actively managed one.

An index linked fund, or index tracker, is one that closely follows one of the stock market indices such as the ISEQ.

For example QUINN-life ‘s Pride ‘n’ Joy Freeway product allows you access the full suite of the firms funds by making monthly contributions starting at €50. There are no transaction charges on regular premiums, and annual management fees start at 1 pc a year for funds such as its European and Irish Equities. They rise to 1.2 pc for US, Biotech and Technology funds.

RaboDirect also offers a range of funds at more competitive rates, with a 0.75pc entry fee and 0.7pc-2.0 pc annual management fee. Investment opportunities are diverse and from €100 a month, you can pick funds that invest in healthcare equities, German equities and global property, for example.