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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: TRINDY who wrote (124186)	8/25/2010 8:33:32 PM
From: Knighty Tin	Respond to of 132070

I cannot say that any ETF calculates fees the way the mutual fund companies I worked for did, but I can't think of any other way that makes sense. At my firms, net asset value was calculated at the end of every business day, as it is at every investment company. The daily expenses are calculated and subtracted from the assets. So, it is all part of the NAV calculation. They did this for my closed end funds as well as my open end funds. Of course, expenses change as the assets either grow or decline. So, you may pay higher daily expenses in February when the fund has a billion dollars worth of assets and less in October when te assets are $3 billion. Some cos are not real vigilant about taking these reductions immediately. The ones I worked for were. With a passion. <G> This includes the management fee, any 12-B1 sales fees, costs of mailing and printing and auditors and lawyers. Commissions the fund pays to trade are netted into the cost of the security, so are not formally subtracted and do not go into the expense ratio. The big argument at my firms was "why are we paying commissions at higher than necessary rates for Wall Street research and also paying our own team of analysts out of management fees? Has anyone proven any vlue added from the Wall Street research? Has anyone proven any value added from our own analysts?" Management loved when the Board asked all of those types of questions. <VBG>