How is CPF Board enhancing the disclosure of trailer fees?
Currently, fund managers pay trailer fees to their distributors who sell their funds to investors. Fund Managers disclose the trailer fees range in their products’ sales documents which distributors (including financial advisors) generally relied upon when selling their products to investors. Such trailer fees range could be too wide to be meaningful to investors. As such, more trailer fees information i.e. the median would be more useful to investors.
From 1 October 2022, Fund Management Companies (FMCs), Insurers, Investment Administrators (IAs), financial advisors and insurance agents are required to disclose trailer fees information (i.e. range and median) in their CPFIS products’ sales documents in order to help CPF investors make informed decision on their investment purchase.
