What Are the Different Types of Fund Management Fees?

During the operation of the fund, there are some necessary expenses to be borne by the fund, among which the fund management fee and fund custody fee are the main expenses paid by the fund.

Fund Management Fee

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During the operation of the fund, there are some necessary expenses to be borne by the fund, among which the fund management fee and fund custody fee are the main expenses paid by the fund.

The fund management fee is the management remuneration paid to the fund manager, and its amount is generally drawn from the fund assets according to a certain percentage of the fund's net asset value. Fund managers are managers and users of fund assets and play a decisive role in maintaining and increasing the value of fund assets. Therefore, the proportion of fund management fees charged is higher than other fees. The fund management fee is the main source of income for the fund manager, and the expenses of the fund manager cannot be amortized to the fund or the fund company, or collected from investors. In foreign countries, fund management fees are usually calculated on a daily basis at a certain percentage (annual rate) of the fund's net assets on a daily basis and are paid regularly.

Chinese name

Fund Management Fee

Main cost

Fund management fee

the way

The amount is generally based on a certain percentage of the fund's NAV

Object

Management remuneration of fund managers

cost

Fund Management Fee

The management fee rate is related to the size of the fund, in general. The larger the fund size, the lower the fund management fee rate. However, at the same time, the fund management fee rate is also related to the type of fund and different countries or regions. Generally speaking, the higher the risk level of a fund, the higher its fund management fee rate. The fund with the highest rate is a securities derivative fund. For example, the annual fee rate of a warrant fund is 1.5%-2.5%. The lowest is the money market fund, whose annual rate is only 0.5%-1%. The annual management fee rate of several other funds announced by the Hong Kong Funds Association: bond fund annual fee rate is 0.5% -1.5%, and stock fund annual fee rate is l%-2%. In countries and regions where the fund industry is well developed, such as the United States, the annual fund management rate is usually around 1%. However, it is higher in some developing countries or regions. For example, the annual fund management rate of Taiwan in China is generally 1.5%, and the annual fund management rate of some developing countries even exceeds 3%.

China's initial annual fund management fee rate was 2.5%. With the intensification of market competition, most of China's funds currently provide fund management fees at a rate of 1.5%. The management fee rate of bond funds is generally lower than 1%, and the management fee rate of currency funds is 0.33%.

In order to encourage fund management companies to use fund assets more effectively, some funds also provide that fund managers can be paid for fund performance. Fund Industry

Fund Management Fee

Performance compensation is usually a certain withdrawal ratio based on the growth of the fund assets under management. As for the number of withdrawals, Hong Kong requires that they be withdrawn at most once a year.