Schroders changes pricing structure to avoid MiFID II confusion

The new MiFID II rules came into force in January, raising concerns over dual pricing. Many advisers claim dual pricing could be misinterpreted as fund fees, following MiFID II regulation.

James Rainbow, Schroders Co-Head of UK Intermediary, has announced Scroders will be switching the pricing structure on a number of funds from dual pricing to swing pricing, in response to demand from advisers.

Under swing pricing, investors pay a single price when purchasing or redeeming shares, as opposed to paying an offer price when purchasing shares and a bid price when redeeming.

Schroders’ new pricing policy will be implemented on 17 September, with any associated costs being met by the firm.

The change will align the portfolios with the rest of Schroders’ funds, which already use swing pricing.

Rainbow said: “We regularly review our fund range to ensure that we are offering our clients the best proposition.

“We will be changing the pricing policy of a number of our Schroder unit trust funds. The pricing of units is currently carried out on a dual pricing basis. From 17 September, the pricing of units will be based on a single mid-market price.

“Switching to single pricing will provide greater simplicity for investors. The change also brings the fund in line with the rest of Schroders’ UK fund range, which already operates, on a single pricing basis.”

The funds affected include:

  • Schroder Absolute Return Bond fund
  • Schroder Asian Income fund
  • Schroder European Smaller Companies fund
  • Schroder European Alpha Plus fund
  • Schroder Gilt and Fixed Interest fund
  • Schroder Global Emerging Markets fund
  • Schroder Global Healthcare fund
  • Schorder High yield Opportunities fund
  • Schroder Income fund
  • Schroder Income Maximiser fund
  • Schroder Managed Wealth portfolio
  • Schroder Recovery fund
  • Schroder Tokyo fund
  • Schroder UK Alpha Plus fund
  • Schroder UK Equity fund
  • Schroder UK Mid 250 fund
  • Schroder UK Smaller Companies fund
  • Schroder US Mid Cap fund
  • Schroder US Smaller Companies fund

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All figures correct as at 30.06.2020.