There are times, for example in stressed market conditions, when trading costs may materially increase due to investors transacting in the Fund. To achieve fair treatment of all unitholders, we may determine in these circumstances that it is more appropriate to have the trading costs borne by those transacting investors, not other investors in the Fund. If we reach this view, we will then begin to apply spreads to whichever of the Funds are being affected by these stressed market conditions.
The actual spread applied will reflect the estimated trading expenses incurred by the Fund in carrying out the market transactions to meet the unitholder application and redemption requests. The buy spread will be added to the unit price on entry to the Fund, and the sell spread will be deducted from the unit price on exit from the Fund. The proceeds of the buy/sell spreads will be retained within the Fund(s) and are not fees paid to Devon or any investment managers.
When applying spreads, Devon will determine buy spreads and sell spreads separately to ensure that they reflect trading costs incurred due to the relevant unitholder action (application or redemption).
There are currently no buy/sell spreads applied to any of the Devon Funds.