Mutual Fund Expense Ratios
The Graph of the Week shows the Management Expense Ratios of Growth Stock Funds. The graph is from Jacob De Rooy's article "Pricing of Mutual Fund Services in Retirement Plans: Evidence from Open- End Equity Funds" in the October 2006 issue of Business Economics . From the article:
Investors can place their retirement monies in mutual funds with a variety of investment objectives and investment styles. For this discussion, I will use growth equity funds, the largest category of mutual funds, which are popular for use in retirement plans. Growth funds use active management to select stocks that are expected to increase in value at an above-average rate. We use a nonrandom sample of 2,651 growth funds in the Value Line Mutual Funds database. The distribution of MERs of this sample is shown in Figure 1.
This paper won the 2006 NABE Contributed Paper Award, presented at NABE’s 48th Annual Meeting, September 11, 2006.