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Practice Management > Compensation and Fees

Lipper Study Examines Mutual Fund Management Fees

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Management fees compensate fund managers and are deducted from fund returns before those returns are reported to investors. These fees can range from .02% of fund assets per year for one institutional index fund to 3.25% for a balanced fund that has an all-inclusive fee schedule, according to Lipper.

Approximately 59% of fund portfolios have breakpoints that decrease management fees as assets in the fund increase, passing on economies of scale. However, Lipper explains, when assets decline these breakpoints work in reverse.