what fees are included in Expense Ratio

[solon]

I'm preparing a lesson on investing for a small group and I was looking up info on expenses. For example, here is  the expense page on Morningstar for AMCPX: https://www.morningstar.com/funds/xnas/amcpx/price

You can see the expense ratio is .68%. But down lower you can see some other fees, i.e., management, 12b-1, administrative. Are these fees included in the expense ratio, or are they in addition to it?

[RWD]

The net expense ratio is what you actually pay annually to own the fund. Side note, the front load on that is highway robbery!

[solon]

The net expense ratio is what you actually pay annually to own the fund. Side note, the front load on that is highway robbery!

Yeah, that's kind of why I picked it! I want to show outrageous examples. Do you know of a fund with a higher expense ratio?

And, does the net expense ratio include the management, 12b-1, and administrative fees? Or are those separate?

[2Birds1Stone]

It depends on the plan @solon. I own VTI in my IRA as well as 401k. Same expense ratio in both, but my 401k plan (Fidelity) charges a quarterly administration fee and bookkeeping fee which is very high! Robbery :) Employers pass on the costs of these plans to the employees.

[MustacheAndaHalf]

And, does the net expense ratio include the management, 12b-1, and administrative fees? Or are those separate?

When I've seen them listed in detail, they are usually the separate components of the expense ratio.

The 12b-1 fee takes your money and uses it for advertising to draw other customers.  You are paying the marketing costs for the fund!  They justify it by claiming you will benefit from more customers bringing economy of scale.  I prefer to avoid funds that charge 0.25% 12b-1 fees, as there's many choices that charge 0%.

Note that very new ETFs may have a subsidized expense ratio.  There may be a negative percent, in order to keep the expense at a fixed, lower amount.  It's an example of the larger company subsidizing the fund until it attracts enough customers to justify it's expense ratio.

Are you looking at the fund prospectus?  Online, I don't see any 3rd party websites that provide detail on the expense ratio (like Yahoo Finance, etfdb, morningstar).  If there's a third party website that shows expense ratio details, I'd like to take a look at it.