Lawsuit Shines a Harsh Light on Subadvisory Fund Fees – Bloomberg 02-21-13

Salient to Investors:

Going to court to prove that a mutual fund charges small investors excessive fees is often an exercise in futility because the courts have set the bar so high for plaintiffs that most suits are dismissed before they even get to trial.

Niels Holch at the Coalition of Mutual Fund Investors said if a management fee is higher than the subadvisory fee and the sub-advisers are doing all of the work, you have to ask yourself what the management company is doing for its fee.

Lipper found the average sub-advised equity mutual fund charges 0.10 percent more than the average internally managed one, 0.05 percent for bond funds.

Vanguard is the only fund company run at cost.

Read the full article at http://www.bloomberg.com/news/2013-02-21/lawsuit-shines-a-harsh-light-on-subadvisory-fund-fees.html

 

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