What is Expense Ratio?
A simple explanation for Indian investors — Wealth Simplified.
Quick Answer
Expense ratio is the annual fee charged by a mutual fund to manage the scheme, expressed as a percentage of assets.
Simple Explanation
It covers management and operating costs of the fund.
How It Works
It is deducted from the fund's assets and reflected in NAV over time.
Why It Matters
Costs matter for long-term investors because they reduce net returns.
Simple Example
A 1% expense ratio means roughly ₹1,000 a year on a ₹1,00,000 investment (illustrative).
Common Misconception
Lowest expense ratio alone does not decide suitability — category, risk and goals also matter.
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Plan Your Financial FreedomAdeethya Investments · AMFI-registered Mutual Fund Distributor · ARN-366563. Mutual Fund investments are subject to market risks, read all scheme related documents carefully before investing.