Mutual Fund Fees Decline, Slightly

Average expense ratios for mutual funds that primarily invest in stocks declined four basis points last year, according to the Investment Company Institute (ICI). Average expense ratios for bond mutual funds and money market funds declined two basis points and three basis points, respectively, from 2010 to 2011.

The declines are not significant, but they do continue a longer-term trend of falling expense ratios. Expense ratios for equity funds averaged 79 basis points (0.79%) last year versus 99 basis points (0.99%) in 1990—an annual savings of $20 for every $10,000 invested. Expense ratios for bond funds averaged 62 basis points (0.62%) in 2011 versus 88 basis points (0.88%) in 1990, a savings of $26 per year for every $10,000 invested.

Several factors are behind the declines.

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Discussion

Roland Phelps from New Jersey posted 11 months ago:

Mutual funds fees are so embedded, hidden, falsely identfied that it is almost impossible for a mutualfund invester to find the total fees to operate a fund. How to search and identify these fees?

Rolly


Barry Portugal from Illinois posted 5 months ago:

I read a 2010 WSJ article that estimated "hidden fees" ranged from about 1% to over 3%, in addition to the stated management fees.

Has there been any recent articles on this topic?


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