Aussie investors giving managed funds the flick

Investors want more control and less fees

Mike King

Mike King is a Fool.com.au Investment Analyst and Writer. He caught the investing bug more than a decade ago, at a time when the U.S. had invaded Iraq and fear reigned in the markets. His initial success as the markets took off encouraged his passion and thirst for knowledge. With 13 years behind him at one of Australia's largest domestic banks, Mike's passion for stocks led him to join a boutique funds management firm, where he stayed for four years. A seven-year stint in equity research at one of the largest investment banks in the world followed that, giving Mike a thirst to pursue his passion further. Mike holds a Diploma in Applied Finance and Investment and a Graduate Certificate in Financial Planning. His passion is to help retail investors invest better, and that passion was one of his primary reasons for joining The Motley Fool Australia in late 2011. Mike has written thousands of articles since joining, including for Fairfax Media, Yahoo!7, Ninemsn and has also appeared on ABC's The Business. You can see all of Mikes' holdings here

Published May 21, 2013 2:29 pm AEST

The 2012 ASX Share Ownership Survey has been released today and makes for interesting reading.

Among other findings, investors holding shares through unlisted managed funds has dropped from 30% in 2000 to just 12% in 2012. The Global Financial Crisis and subsequent sharemarket falls, meant investors became frustrated with fund managers being unable to out-perform the market, and being forced to pay high fees for that under-performance.

Investors want to be more in control of their performance, and avoid the excessive fees charged by many unlisted funds. Until the industry changes its fee models, the decline is likely to continue.

A simple investment in any one, or a combination, of Commonwealth Bank (ASX: CBA), ANZ Bank (ASX: ANZ) or Westpac Banking Corporation (ASX: WBC) over the past year, would have outperformed the S&P / ASX 200 Index (Index: ^AXJO) (ASX: XJO) comfortably, as you can see from the chart below – along with just about every fund manager.

Source: Google Finance

Who says you have to pay high fees to beat the market?

In the market for high yielding ASX shares? Get "3 Stocks for the Great Dividend Boom" in our special FREE report. Click here now to find out the names, stock symbols, and full research for our three favourite income ideas, all completely free!