Mutual Fund Expense Ratio

alspeirs | 9:22 am | February 6, 2008 | finance

Not a lot of people realize that mutual fund fees can compound to really erode the investment value of the mutual fund. Mutual fund expense ratios commonly range from .20 percent and less for the lower costing index funds all the way to over 2 percent for actively managed funds. Needless to say the average is generally 1.4 percent for more than 14,000 stock and bonds that are currently available. To break that down in dollars, I am saying that the fee is only $14 a year for each $1,000 investment value (with a net value of $986). You can see how that effects the investment value