All the above calculations assume that all transactions took place without any fees being charged. In practice, fees are always charged.
Fees for buying and selling securities:
The fund pays this fee to the bank that manages it. The fee is generally set at about 0.25% of the total purchase or sale. If the fund buys securities for $10,000, it will pay $25 in fees.
Fee charged by the fund manager:
The fund manager collects a fee from the fund’s assets for managing its investments.
Governance fee charged by the trustee:
The trustee also charges a fee for supervising the fund.
The fund manager collects a one-time payment from purchasers of shares in the mutual fund. Entry fees are usually between 0.5% and 1.5% of the purchase value.
Investors usually pay entry costs directly to the fund’s manager and these fees do not affect the fund’s assets. All other fees are paid from the fund’s cash accounts, and thereby reduce the fund’s assets and profits.