I record Bloomberg ETF IQ for entertainment purposes, not investment advice. This week’s episode had a revenue by fee bucket list for ETFs provided by the industry. The percentage of revenue provided was broken down by the expense ratios.
ETFs with an ER from 0-10 bps provide 19% of the income for the companies, 11-20 bps provide 16%, 21-30 bps provide 8%, 31-40 bps provide 15%, 41-50 bps provide 9%, and 51+ bps provide 33%.
The hosts of the show think any ER below 20 bps is a bargain. Most Bogleheads think an ER over 5 bps is expensive. The 33% of revenue provided by funds with an ER above 51 bps probably explains the proliferation of active ETFs. I’m amused by companies like Van Eck that are jumping on the ETF bandwagon. Costs matter for fund companies as well as investors.
DMW
ETFs with an ER from 0-10 bps provide 19% of the income for the companies, 11-20 bps provide 16%, 21-30 bps provide 8%, 31-40 bps provide 15%, 41-50 bps provide 9%, and 51+ bps provide 33%.
The hosts of the show think any ER below 20 bps is a bargain. Most Bogleheads think an ER over 5 bps is expensive. The 33% of revenue provided by funds with an ER above 51 bps probably explains the proliferation of active ETFs. I’m amused by companies like Van Eck that are jumping on the ETF bandwagon. Costs matter for fund companies as well as investors.
DMW
Statistics: Posted by Dead Man Walking — Tue Jul 16, 2024 11:34 pm — Replies 0 — Views 135