Explaining Investment Fund Fees
With the arrival of CRM2, advisors may see an increased interest by investors in understanding the costs of their financial products and how those costs compare across products or with the costs in other countries. Of course, there are costs to owning any type of any financial product, be it insurance, a deposit account, securities or an investment fund. For mutual funds, it’s important to know that the costs are fully disclosed and reported as a total amount, usually including the cost of advice, and net of returns, so the investor knows what the real return is and how much s/he is paying. Investors in other countries, such as the U.S., may have to tally up management costs, trading costs and advisor and other hidden costs and then try to calculate their returns.
We offer some tools to help explain costs to investors along with more detailed studies and reports from independent third parties on investment fees.