Before Reimbursement Expense Ratio

DEFINITION of 'Before Reimbursement Expense Ratio'

The percentage of a fund's average net assets that is used to cover the annual operating expenses of managing a mutual fund before reimbursements are made to the fund by managers.

Also known as the "gross expense ratio".

BREAKING DOWN 'Before Reimbursement Expense Ratio'

A mutual fund's operating expenses include management fees, transaction costs and other business costs. Some of these expenses may be reimbursed by management. Reimbursed fees often include indirect fees such as transaction costs from dealing with other mutual funds, transaction costs associated with exchange traded funds, or the dividends paid out from a short position on an asset.

Reimbursements also occur when a fund's expense ratio is limited. In capped funds, an expense limit is created to place a ceiling on the charges to the fund's shareholders. The limit is often expressed as a percentage and is a highlighted in the fund's prospectus.

RELATED TERMS
  1. After Reimbursement Expense Ratio

    The actual expense paid by mutual fund investors. The after reimbursement ...
  2. Capped Fund

    A mutual fund that has a limited amount of operating expenses ...
  3. Expense Ratio

    A measure of what it costs an investment company to operate a ...
  4. Total Annual Fund Operating Expenses

    For a mutual fund or other type of fund management structure, ...
  5. Expense Limit

    A limit placed on the operating expenses incurred by a mutual ...
  6. Fund Of Funds

    A mutual fund that invests in other mutual funds. This method ...
Related Articles
  1. Mutual Funds & ETFs

    Pay Attention To Your Fund’s Expense Ratio

    Even small differences in an expense ratio can have a big impact on a portfolio.
  2. Mutual Funds & ETFs

    Expense Ratio

    Expense Ratio
  3. Investing Basics

    ETF Gross vs. Net Expense Ratios: How They Differ

    If you're going to invest in ETFs, you should know the intricacies of expense ratios.
  4. Investing Basics

    4 Expensive Mutual Fund Mistakes to Avoid

    Mutual funds are a good way to balance your asset allocation but there some potentially expensive pitfalls investors need to be aware of.
  5. Options & Futures

    Overview Of Mutual Fund Expenses

    By Richard Loth (Contact | Biography)"In the mutual fund field, costs assume a tremendous importance for the long-term investor. Other things held equal, lower costs mean higher returns." -John ...
  6. Mutual Funds & ETFs

    5 Characteristics of Strong Mutual Fund Shares

    Discover some of the basic characteristics shared by good mutual funds that investors can use to help them in selecting funds.
  7. Mutual Funds & ETFs

    Mutual Funds: Management Fees Vs. MER

    Having a clear understanding of the fees charged by a mutual fund is a significant component to making an informed investment decision. Often the management fee is used interchangeably with the ...
  8. Mutual Funds & ETFs

    Trading Mutual Funds For Beginners

    Learn about the basics of trading and investing in mutual funds. Understand how the fees charged by mutual funds can impact the performance of an investment.
  9. Mutual Funds & ETFs

    Stop Paying High Mutual Fund Fees

    Discover how investment strategies and expense ratios impact your mutual fund's returns.
  10. Mutual Funds & ETFs

    A Guide For Picking Long Term Mutual Funds

    Learn about considerations for investors when buying shares in a mutual fund for a long-term investment, including fees, type of management and portfolio goals.
RELATED FAQS
  1. How do waivers, reimbursements and recoupments affect a fund's expense ratio?

    Understand what waiver, reimbursement and recoupment agreements in relation to a mutual fund mean for the management fees ... Read Answer >>
  2. When is an expense ratio considered high and when is it considered low?

    Discover what is considered an exceptionally high or low expense ratio for a mutual fund or ETF, and learn why this figure ... Read Answer >>
  3. Why is a mutual fund's expense ratio important to investors?

    Understand the nature of mutual fund expense ratios, and learn why it is critically important for investors to be aware of ... Read Answer >>
  4. Do mutual fund trading costs hurt your bottom line?

    Find out how a mutual fund's expense ratio could be eating into your bottom line, what costs are included and an example ... Read Answer >>
  5. What kinds of expenses are included in the expense ratio?

    Understand the variety of costs and charges that are included in the total expense ratio assessed to investors using mutual ... Read Answer >>
  6. Can mutual fund expense ratios be negative?

    Learn what an expense ratio is, and whether mutual funds, closed-end funds and exchange-traded funds can have negative expense ... Read Answer >>
Hot Definitions
  1. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating the capital under its control to profitable investments. ...
  2. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  3. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  4. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  5. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  6. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
Trading Center