Gross Expense Ratio

The gross expense ratio is a measure of a fund’s total expenses before any adjustments. It encompasses all costs associated with managing and operating a fund, including 12b-1 fees, management and administrative charges, operational expenditures, and all other costs tied to managing and operating a fund, before any fee waivers or other reductions are applied. Transaction fees, brokerage costs and sales charges are not reflected in the gross expense ratio. It is important to look at both the expense ratio and gross expense ratio when evaluating a fund. For example, if a fund has an expense ratio of 2% and a gross expense ratio of 3%, 1% of potential fees or other expenses were waived. There is no guarantee that these rebates or reimbursements will continue in the future, and if they are discontinued, the cost of owning the fund represented by the expense ratio would be 3%.

We pull our expense ratios from the fund prospectus or annual report, depending on which has been published most recently. Annual report expense ratios reflect the actual fees charged during a particular fiscal year, while prospectus expense ratios reflect material changes to the expense structure for the current period.