Bangalore: You make investment with the aim of earning higher returns. While choosing your investment vehicle, you do market research and consult your advisor and make your financial move. When you do so much for choosing the best investment option, then take some more time to think whether other factors are eating your benefits or not? The cost of managing your investment shouldn’t be too much of what you gain. Here are 5 ways to know whether you are overspending on your investment or not, as reported by Investopedia.com.

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1. Expense Ratio

When you own mutual funds, ETFs or closed-end funds, you select an investment company to professionally manage your funds. An investment company provides you a number of services like recordkeeping, custodial and legal services, and accounting and auditing; to properly operating your funds. For these services, the investment company will charge you fees, which stands as the operating cost. If these fees are high enough, it would lower the return on your investment. Retail investor should be vigilant about the operating cost or expenses of their mutual funds or ETF, if their aim is to earn a pound and not a penny.

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