How to calculate the cost of the fund?

A fund is an investment tool, which consists of funds and invests in various assets. Fund expenses refer to all expenses required for the establishment and operation of the fund, including management fees, custody fees and other related expenses. The calculation of fund cost is very important for investors, because it will directly affect the performance of the fund.

Management fee is the fee charged by the fund company for managing the service of the fund. This is usually an annual fee, which is charged according to a certain proportion of the fund's net assets. The management fee is generally between 1%-2%, which may be different for different fund types and management companies.

Custody fee refers to the fee charged by the fund asset custodian for keeping secrets and managing the fund assets. The custody fee is usually between 0. 1%-0.5%, depending on the fund type and asset size.

In addition, the fund may also charge other fees, including sales fees and transaction fees. Sales expenses are usually the fees charged when purchasing a fund, which are generally the front-end expenses of the fund's net assets. Transaction fee is the fee charged by the fund company for each transaction of assets, including transaction commission and net price difference.

Investors can usually find the fund's expense report in the fund's sales documents, which can help investors better understand the fund's deduction. At the same time, the fund company will also announce the cost rate of the fund, which is the so-called "expense rate", which is the main index of the fund cost. Fund expense ratio is the ratio of fund cost to fund total assets, usually between 0.5% and 3%. The lower the expense ratio, the better the performance of the fund.

Therefore, investors should not only consider the performance of the fund, but also pay attention to the cost of the fund when choosing the fund. It is best to choose a fund with low expense ratio and good performance to get a better return on investment.