Finance · South Africa
How Allan Gray Orbis Fees Protect Investors from Losses
Moneyweb · 2026/01/22
Summary
Allan Gray Orbis uses a unique fee structure for its investment funds. Part of the performance fees collected from investors is set aside in a special reserve. This reserve is then used to return money to clients if the fund underperforms, ensuring that the fund manager shares the risk of losses as well as the benefits of gains. This approach means investors are not just paying a fixed fee but are also protected from paying high fees during times when the fund does not perform well. This fee structure is designed to align the interests of the fund manager and the investors, promoting more responsible management of funds. It adds a layer of security for investors, offering a balance between sharing in success and protecting against poor performance. For everyday South Africans, this means better assurance that their investments are managed fairly and with shared accountability.
OnABudget takeaway: This fee structure means investors are less likely to lose money on fees during poor fund performance, helping protect their investment returns. Small investors can feel more confident that managers are motivated to perform well, as they share in both profits and losses.