What Expenses Are There for Mutual Funds?

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Mutual fund managers can add to expenses for mutual funds, so it's important to gain an understanding of expense ratios. Find out how expense ratios in mutual funds affect the rate of return with help from a registered financial consultant in this free video on investments and personal finance.

Part of the Video Series: Beginner Investing
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Video Transcript

This is financial adviser Patrick Munro talking about, what expenses are there for mutual funds. There are many mutual funds available, in fact there's over 11 thousand available out there in the market place today. But mutual fund managers don't work for free. There are expense ratio's to consider, and you have to be aware of what these expense ratio's are all about. When you look at a mutual fund you have to look at their overall load, and the load is the fee that the manager charges to actually take the money into the mutual fund and manage it for the client. These charges and expenses can range as high as 3 percent. So if you made 4 percent in that particular mutual fund, but had to pay a 3 percent load, you only made 1 percent, and you could have done better at the bank. So it's important if you're a mutual fund investor to be aware of the expense ratio in all mutual funds and how they affect your rate of return. This is Patrick Munro financial adviser, talking about, what expenses are involved in mutual funds.

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