First Asset Investment Management has announced its intent to eliminate all advisor-class units of its Exchange Traded Funds (ETFs).
Advisor-class units pay a service fee to financial professionals who have purchased them on behalf of their clients. This class of units is currently only offered on certain First Asset ETFs.
In an announcement this week, First Asset said the advisor-class units will no longer be issued as of April 28, and common class units will no longer be converted to advisor-class units.
Changing regulatory environment
“The advisor class units represent less than 2% of First Asset's ETF assets under management and First Asset anticipates the changing regulatory environment will continue to reduce the demand for these units,” stated First Asset.
In early July, annual management fees on the units will be reduced by the same amount as the service fee associated with that class of unit. First Asset will then begin to convert all advisor-class units into common class units of the same ETFs.
First Asset says unitholders do not have to take any action to participate in the elimination of the service fee or the conversion.