Castlestone's Aliquot Gold Bullion fund has underperformed under the weight of unusually high charges, fund factsheets reveal. Inflows on three of the firm's funds were briefly suspended and several of its managers have left. The Aliquot Gold Bullion fund, domiciled in the British Virgin Islands, is billed as having a 100% direct exposure to physical gold bullion, making it in essence a tracker fund. However, the fund's retail A share class carries a 2% management fee as well as a 1.5% administration fee - extremely high for an index fund. By contrast, ETF Securities' Physical Gold exchange traded fund charges just 0.39% a year. While gold bullion has appreciated by 126.51% since July 1, 2006, a retail A share class of the Castlestone gold bullion fund would have risen in value by 95.25% over the same period. The C share class, which Castlestone says is typically used by British financial advisers, would have appreciated by 110.82%. Castlestone says the fund is designed to offer an open-ended alternative to exchange traded products, which typically charge lower fees. Elsewhere in its range, the firm says it is still not allowed to explain the reasons behind the suspension of inflows into the Aliquot Commodity, Aliquot Agriculture and Intelligent Portfolio (IQ) Asset Allocation funds by the Central Bank of Ireland on June 2. The suspension was lifted on June 10, although there has been no clarification on what documentation the firm was asked to provide that originally led to the suspensions. The firm says central bank rules do not permit it to comment on the reasons behind a suspension. The central bank has also declined to comment. After the suspensions were lifted, it was revealed that several managers had left Castlestone, including Arrash Zafari, the manager of its newly launched Next 11 fund, and Bradley Yim, who ran one of the suspended portfolios. Castlestone last week hired Fin International, an external public relations firm, to comment on its behalf instead of its own in- house press team. In a statement, Fin confirmed that Castlestone has also split the roles of head of compliance and head of legal, which were formerly jointly performed by Ed Williamson. Copyright: Centaur Communications Ltd. and licensors (c) 2011 Fund Strategy. Provided by ProQuest LLC. All rights Reserved.

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