Costs And Expenses


DEFINITION of 'Costs And Expenses'

As related to mutual funds, it is one of the principal criteria for judging the investment quality of a mutual fund. Funds that are passively-managed tend to have lower costs and expenses, compared to their actively managed counterparts. The "expense-factor" is a key determinant of a fund's investment return to shareholders.

BREAKING DOWN 'Costs And Expenses'

There can be many components in a mutual fund's cost structure. Some things you may end up also paying include: commissions, transfer fees, funds switch fees, back end loads, front and loads and 12b-1 fees.

  1. Expense Ratio

    A measure of what it costs an investment company to operate a ...
  2. Turnover Ratio

    The percentage of a mutual fund or other investment vehicle's ...
  3. 12B-1 Fee

    An annual marketing or distribution fee on a mutual fund. The ...
  4. Level Load

    An annual charge deducted from an investor's mutual fund assets ...
  5. Alpha

    Alpha is used in finance to represent two things: 1. a measure ...
  6. Equity

    Equity is the value of an asset less the value of all liabilities ...
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