Standard Life Investments’ UK Smaller Companies fund is to discourage new investors by removing initial charge discounts available through some financial advisers and increasing the annual management charge.

The decision to ‘soft close’ the fund on 27 June 2011 comes four months after What Investment recommended the fund as a ‘buy’ to its readers following consistent, strong performance and rising inflows.

Jacquie Kerr, head of UK Wholesale for Standard Life Investments, said the decision to discourage new inflows by increasing the charges was to ensure assets were effectively managed within the fund.

She said, ‘These charges both reflect the premium nature of this fund and will allow additional control over demand in support of our objective of protecting our investors’ interests while the soft close arrangement remains in place.

‘At Standard Life Investments, we continually monitor all risks associated with our portfolios, including those that may be the result form growth in assets, such as capacity and liquidity.

'Through the monitoring of all risk contributors to our portfolios, this is measured at individual stock level in addition to the overall fund.’

According to independent statistics from Morningstar, a £1,000 investment in the fund would have grown to £2,980 over the ten years to the end of March, making it the sixth best performer in its sector.

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