SIE: 3.1.3.3. Additional Fees

3.1.3.3.  Additional Fees

Mutual funds charge certain fees besides sales charges that come out of the funds’ assets. These fees are part of a fund’s expense ratio, which is the total operational expenses divided by the NAV of the fund. Expense ratios include management fees, 12b-1 fees, shareholder service fees, transactional fees, legal expenses and custody costs. Expense ratios do not include sales loads. Actively managed funds tend to have higher expense ratios than passively managed funds (i.e., index funds) because of their higher management fees and transactional costs. 

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