Why might management fees be a bigger factor

Reference no: EM13297313

You expect a tax-free municipal bond prtfolio to provide a rate of return of 4%. Management fees of the fund are .6%. What fraction of portfolio incomes is given up to fees? If the management fees for an equity fund also are .6%, but you expect a portfolio return of 12%, what fraction of portfolio incomes is given up to fees? Why might management fees be a bigger factor in your investmentjdecision for bond funds than for stoc funds? Can your conclusion help explain why unmanaged unit investment trusts tend to focus on the fixed-income bracket?

Reference no: EM13297313

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