Third of trusts have expenses under 1%

Almost a third of investment trusts have a total expense ratio (TER) of less than 1 per cent, a study by the sector trade body shows.

The Association of Investment Companies (AIC) found that almost two thirds of investment trusts have TERs (which include annual management charge and other yearly expenses) of less than 1.5 per cent, while 31 per cent charge less than 1 per cent.

Of the 242 trusts researched, the global growth income sector accounted for the largest proportion with TERs below 1 per cent. The lowest was the Independent investment trust, with a TER of 0.36 per cent, followed by Edinburgh US Tracker trust, at 0.4 per cent.