ETF Model Solutions®

Average Mutual Fund Costs

The following table provides the Net Expense Ratio and the Turnover Ratio for all the broad Morningstar Mutual Fund Categories. As you can see, both these ratios are considerably higher than the comparable numbers for Exchange Traded Funds.
For example, the weighted average Expense Ratio for our Global Equity ETF Model is 0.31% vs. 1.46% average for World Stock Mutual Funds. This saving goes directly to augment the investor’s bottom line. You can use this table to compare the costs of your current portfolio to an average Mutual Fund and get an idea of where you stand on the cost curve.

MUTUAL FUND AVERAGE EXPENSE & TURNOVER RATIOS

Responsive Table
NAME/CATEGORY Prospectus Net Expense Ratio Turnover Ratio %
DOMESTIC EQUITY
US OE Large Blend0.9464.9
US OE Mid-Cap Blend1.0757.6
INTL DEVELOPED EQUITY
US OE Foreign Large Blend1.0155.17
US OE Foreign Small/Mid Blend1.2753.18
US OE Europe Stock1.2491.94
US OE Pacific/Asia ex-Japan Stk1.3760.53
EMERGING MARKETS EQUITY
US OE Diversified Emerging Mkts1.3363.21
WORLD EQUITY
US OE World Large Stock1.1444.5
DOMESTIC FIXED INCOME
US OE Short-Term Bond0.73101.14
US OE Intermediate-Core Bond0.67193.06
US OE Long-Term Bond0.784.13
TARGET DATE FUNDS
US OE Target Date 2000-20100.6235.83
US OE Target Date 20150.6733.40
US OE Target Date 20200.7537.87
US OE Target Date 20250.7333.32
SOURCE: Morningstar (February 2020)
Compared to ETFs, a mutual fund is generally less tax inefficient, offers less transparency (with respect to holdings), has a higher cost, and is less liquid (can only be purchased/sold at the close of the trading day). ETFs are typically more transparent with respect to their current holdings and can be purchased/sold throughout the trading day.