BMO GAM slices charges on eight ETFs

Charges will drop by as much as 43% as firm achieves economies of scale


BMO GAM has sliced charges across its Income Leaders and global corporate bond fund ranges after growing assets in its global ETF division and achieving better economies of scale.

The changes, which came into effect on 1 September, will see five of its Income Leader ETFs lower their charges by 10bps, bringing the ongoing charges figure down from between 35bps to 40bps to 25bps to 35bps. The range, which include US, UK and Europe funds, aims to generate sustainable income and capital growth opportunities in a risk-controlled framework.

But the fund group’s Barclays Global Corporate Bond ETFs will see the most dramatic price cut. The trio of funds, which provide investors with exposure to other investment grade global corporate bond ETFs across the maturity spectrum, will see charges drop 43% from 30bps to 17bps.

Kevin Gopaul, head of quantitative strategies and ETFs at BMO GAM, said the firm’s continued global growth in the ETF space has meant it can better leverage economies of scale to pass on savings costs to clients.

Assets in BMO GAM’s global ETF business have risen by roughly 30% during the past year from £23.5bn last May to £30bn in July 2018.

The fund group has more than 100 ETF listings globally since establishing its first ETF in Toronto in 2009. Its Income Leaders and Barclays Global Corporate Bond ranges were first made available to UK investors in November 2015.

Rob Thorpe, managing director, head of distribution, intermediary, UK (pictured) added: “We are always listening to clients and are acutely aware that cost is a real focus for many. As such, through offering our innovative ETFs at this reduced rate, we are able to offer even better value for money in the ETF space.”

The affected funds:

Source: BMO GAM