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What makes an excellent fund factsheet?

A fund factsheet is a vital communication tool that bridges the gap between fund managers and investors. An excellent factsheet does more than relay information – it engages, informs and builds trust. But what exactly makes a fund factsheet stand out? Let’s dive into the key elements that contribute to the effectiveness of these essential documents.

Clarity and accuracy of information

First and foremost, clarity and accuracy are the cornerstones of an excellent fund factsheet. Investors rely on these documents to make informed decisions, so every piece of data – from performance metrics to fund objectives – must be up-to-date and precise. Misinformation or unclear data can lead to poor investment decisions and damage the trust that investors place in a fund management firm.

Comprehensive yet concise

A top-notch factsheet strikes the perfect balance between  comprehensiveness and conciseness. It should cover all the necessary details investors need, not necessarily limited to pure financial information, and could extend to other topics such as sustainability, without overwhelming them with too much technical jargon or excessive information. The goal is to keep the investor informed and confident about their understanding of the fund’s position and potential.

Visual appeal and accessibility

The design of a fund factsheet should not be overlooked. A well-designed factsheet uses visual elements like charts, graphs and colour coding to make the data easily digestible and engaging. Good design can help highlight key figures and trends, making them immediately apparent to the reader. Furthermore, the factsheet should be accessible, meaning it must be easy to read on paper and on any device, be it a computer, tablet or smartphone.

Regular updates

Regulation is ever-changing and a factsheet needs to reflect the most current data available. Regular updates are crucial to maintain the relevance of the information provided and to stay compliant. A fund factsheet that is outdated can mislead investors or cause them to question the fund's management effectiveness.

Emergence of ESG values

One of the emerging trends in the investment world is the growing focus on sustainability and social responsibility. Investors are increasingly aware of the environmental, social and governance (ESG) impacts of their portfolios and seek to align their values with their financial goals. They rely on metrics to help them make informed investment decisions and naturally look for them in fund literature. It is therefore important that asset managers can produce collateral encompassing ESG alongside financial metrics to ensure they deliver to investors’ expectation.

At FE fundinfo, amongst the data we collect and store in our database data from multiple sources ensuring its validity and accuracy, we also collect ESG market data. Optionally, we can derive metrics by undertaking ESG-specific calculations using data of our clients’ licensed third party data vendors. We can also visualise this data in documents such as factsheets giving us the ability to create very comprehensive, ESG-specific factsheets alongside pure financial as well as blended factsheet documents.  

Investor-centric approach

Lastly, an excellent factsheet is one that considers the needs and preferences of its audience. It should address the questions that matter most to investors and present information in a way that resonates with them. Understanding the investor's perspective can help tailor the content to better meet their expectations and enhance their engagement with the fund.

An excellent fund factsheet is an amalgamation of detailed yet clear information, appealing and functional design and regular updates, all wrapped up in a document that meets best practice and addresses investor needs. By focusing on these key elements, asset management companies can ensure their factsheets serve as an effective tool for communication and trust-building, ultimately aiding investors in making well-informed decisions.

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