Expense ratio

[shyam.trivedi]

What does the 'expense ratio' of an investment fund mean?

 

[shyam.trivedi]

Expense Ratios represent the amount of money a fund spends on management.
The new ETFs have relatively low expense ratios compared with traditional mutual funds, which is one feature that makes them so attractive.
Advertising costs are NOT included in the Expense Ration of a fund. You should also check for load and any additional administrative fees or advisory costs.
Most online trading portals have information on market jargons like this. Check out Reliance , HDFC and ICICI online websites.

 

[_cesc.]

also check out that a higher expense ratio can actually lower your investment by nearly half in long term if you dont keep a proper check.
_cesc.

 

[milind]

High Expense ratio sounds bad - management stuffing their own pockets no matter whether they make money for investors or not. However, when you are comparing funds based on long term performance, the returns already factor in the fund expenses. No need to look at expense ratio separately.

-- Milind