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Mutual Funds




Expense Ratio


The ratio of a mutual fund‘s assets (resources) required to cover its annual operating expenses and management fees (to its net assets). For example, if a fund charges $1 per $100 of net assets, the expense ratio is 1%.

Expense ratio is determined based on multiple factors including a fund’s size and type and measures of cost control, etc. However, it is not related to a fund’s sales fee. In practice, expense ratios range from 0.4% to 1%.

It is also known as management expense ratio (MER).



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Mutual funds are financial vehicles (investment funds) that pool contributions from many- or large number of- investors for the purpose of investing ...
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