What is a Fund Supermarket?
A fund supermarket is typically a web site or brokerage firm which aims to provide an alternative, more convenient way of investing in collective investment funds. The 'supermarket' term reflects the way in which they operate; a variety of funds can be purchased from a number of different management groups in one online place. Similar to real life supermarkets, the online counterparts have different goods on offer with services, size and cost varying greatly.
Fund supermarkets were pioneered in America and first introduced to the UK investor at the end of 1999. Among the first to appear were Fidelity’s FundsNetwork and Prudential’s Egg, both in 2000. Since then the choice of supermarkets has become considerably larger, although there have also been other changes, such as Egg being acquired from Prudential by Citigroup in 2007.