10 Oct 2011, by
Subadvised funds, or funds whose portfolios are managed by an outside investment company, have taken center stage this year in part because of excessive fee lawsuits sought by investors. Sasha Franger examines the subadvisor fee to determine if an additional fee is tacked onto the existing management fee, or if other expenses decrease to compensate for the cost of the subadvisor. In addition, Sasha looks at how much of the management fee is actually retained by the advisor and/or administrator. Finally, she recommends supplementary subadvisor report content for fund management companies and boards of directors to examine during the contractual renewal process.