Expense ratio: the fee that quietly compounds
A fund's expense ratio is the percentage of your money it charges every year — deducted from the fund's returns before you ever see them. It sounds small, and that's exactly why it's easy to underestimate.
What it includes
The expense ratio bundles the fund's management fee, administration, and distribution costs into one annual percentage of assets. It is already reflected in the fund's NAV, so you don't pay it as a separate bill — it simply lowers the return you earn.
Why 1% is not small
On a portfolio compounding for decades, a one-percentage-point higher expense ratio can quietly consume a large share of your final corpus, because the fee is charged every year on the whole balance — including the gains the fee itself prevented from compounding. That's why a cheaper index fund can beat a pricier active fund that looks similar on paper.
Compare it against the benchmark, not in isolation
A higher fee can be justified only if the fund reliably beats its total-return benchmark by more than the fee. OmniAsset shows each fund's expense ratio alongside its performance versus its own legal benchmark, so you can judge whether you're paying for outperformance or just paying.
See each fund's expense ratio next to its real, benchmark-relative returns.
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