Are Your Managers Overpaid?

Mutual fund expenses for operations and management fees are reported as an “expense ratio,” the percentage of fund assets taken annually by the fund company. Certain kinds of funds are more expensive to run than others, so investors should compare their funds’ expenses with the category averages, shown below.

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Avg. expense Category ratio Equity funds Diversif. Pacific/Asia 2.8% Pac./Asia ex-Japan 2.3 Diversif. emerg. mkts. 2.2 Latin America 2.2 Precious metals 1.9 World 1.9 Japan 1.9 Natural resources 1.8 Technology 1.8 Europe 1.8 Intl. hybrid 1.8 Small growth 1.7 Health 1.7 Foreign 1.7 Mid-cap growth 1.6 Financial 1.6 Real estate 1.6 Convertibles 1.6 Large growth 1.5 Small blend 1.5 Mid-cap value 1.5 Small value 1.5 Utilities 1.5 Communications 1.5 Mid-cap blend 1.4 Large blend 1.3 Large value 1.3 Domestic hybrid 1.3 Bond funds Emerging markets 1.7 Multi-sector 1.4 International 1.4 High yield (junk) 1.3 Intermed.-term govt. 1.2 Muni (long-term) 1.1 Long-term govt. 1.0 Short-term govt. 1.0 L-T investment-grade 1.0 I-T investment-grade 1.0 Muni (intermed.-term) 1.0 S-T investment-grade 0.8 Ultrashort 0.8

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