TITLE

The Impact of Expenses on Equity Mutual Fund Performance

AUTHOR(S)
Apap, Antonio; Griffith, John M.
PUB. DATE
February 1998
SOURCE
Journal of Financial Planning;Feb1998, Vol. 11 Issue 1, p76
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This article examines the relationship between the performance of equity mutual funds and the various expenses incurred by investors, specifically sales charges, 12b-1 fees and expense ratios. The intention of this study is to resolve the conflicts that exist in the current literature regarding the impact of expenses on the performance of equity mutual funds. Many investors use past performance when forming expectations of future performance and as one of many criteria when choosing mutual funds for investment. Given the growth in the number of mutual funds and in the total dollars invested in them, one could expect that the expenses that mutual fund investors incur are clearly defined and their possible benefits understood. Finally, one might argue that mutual fund performance could be improved by employing the best personnel and by using expensive research facilities. Thus, the expectation is that higher expense ratios will lead to better future performance.
ACCESSION #
268955

 

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