Mutual Fund Total Cost Construct

Abstract

This study develops the comprehensive mutual fund Total Cost Construct, designed to provide “normative transparency of disclosure” to fund shareholders. The categories include 1) fund management fees, 2) fund distribution fees, 3) fund trading costs, and 4) fund total costs. The article presents a Partial Cost Structure with three cost categories and those components and subcomponents for which SEC total expense ratio components provide estimates. It also presents the comprehensive Total Cost Construct, which includes four cost categories with components and subcomponents. Complete cost estimates are as yet unavailable.