What are the costs associated with a mutual fund?

Listed ongoing costs may include: Management fees: The cost to pay fund managers and investment advisors. 12b-1 fees: Capped at 1%, these fees pay for the cost of marketing and selling the fund and other shareholder services. Other expenses: These may include custodial, legal, accounting, transfer agent expenses and other administrative costs.

What are mutual fund management fees?

Management fees are a significant part of a mutual fund’s annual expenses. These fees are paid to investment advisors for portfolio management and certain administrative tasks. They also cover the fund’s operating costs, including hiring the portfolio manager and investment team.

Do mutual funds charge fees?

Investors incur charges for holding mutual funds, which can significantly impact investment returns. Certain funds charge direct fees to cover individual investor transactions and account costs, while others charge periodic fees to all shareholders. Investors can incur these fees when they buy or sell a fund.