Pay for what you get
Smart beta index provider, ERI Scientific Beta, has launched their "pay for what you get" approach to index pricing, to disrupt the traditional fixed fee structure on assets under management (AUM).
Investors who choose the Scientific Beta Multi-Beta Multi-Strategy index from 1 June will pay zero fixed fees, and will only pay variable fees if the option outperforms the reference cap-weighted index.
ERI Scientific Beta chief executive, Noël Amenc, said "our rationale for this mandate offer is that smart beta providers' claims on the quality and robustness of their strategies should materialise in their live performance".
"ERI Scientific Beta's initiative is intended to provide consistency between the smart beta provider's revenues and the quality of its offering."
The firm said it was a pure performance fee mandate as part of its investor-friendly approach which has attracted more than US$10 billion in assets under replication for its smart beta indices in three years.
Recommended for you
Volatility in US markets means currency is becoming a critical decision factor in Australian investors’ ETF selection this year.
Clime Investment Management is overhauling the selection process for its APLs, with managing director Michael Baragwanath describing the threat of a product failure affecting clients as “pure nightmare fuel”.
Global X will expand its ETF range of exchange-traded funds next month with a low-cost Australian equity product as it chases ambitions of becoming a top issuer of ETFs in Australia.
Flows into Australasian sustainable funds have moved back into outflow territory in the second quarter of 2025 driven by US$400 million in redemptions from passive funds.
