What does the expense ratio in a mutual fund mean?
This ratio measures the per-unit cost of managing a fund. The fund’s total expenses are divided by its assets under management (AUM) to arrive at this ratio. Various costs incurred by the fund house are part of the expense ratio. For example, there is a fund management team that tracks the equity and debt markets and companies in the portfolio. The fund house also incurs expenses such as registrar, custodian, legal, audit fee ..
