Fitzrovia Finds Fund Fees Almost Double in Europe
October 30, 2005
European mutual funds fees are almost twice as high as U.S. fees, as portfolios in the states benefit from economies of scale in a unified market, according to research firm Fitzrovia, a division of Lipper.
The average total expense ratio on a cross-border European equity fund is 1.79%, whereas the average U.S. fund sports a fee of 0.92%. And a British fund charges an average of 1.68%. The gap is similar with regards to expense ratios on bond funds, as well, with the average U.S. fixed income portfolio charging 0.86%, versus 1.35% on a cross-border, fixed-income European fund and 1.24% on a U.K. fund.
Two of the main factors driving up fees in Europe are a fractured regulatory environment and smaller fund sizes.
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