Investment Management Fees

Mutual Fund Management Fees

Imagine my surprise and great pleasure to read that the Supreme Court is considering a case regarding excessive Mutual Fund Management Fees, see http://bluelobsta.blogspot.com/2005/11/mutual-funds-and-other-ways-to-go.html.

In winding its way to the Supreme Court 2 lower court judges disagreed with one stating the determinant should be what the same manager charges institutional clients while another felt intra-fund comparisons were appropriate. I clearly come down on the side of comparing to other clients within a firm. I feel the management fees charged a mutual fund should be no more then that charged to an institutional investor and most likely lower. Mutual Funds already pay additional fees for the additional services they require such as accounting, auditing, and custody.

Investment Managers are already struggling with lower revenue due to the falling markets so a decision in this case could be catastrophic for some. Perhaps costs will finally become a serious consideration in running an investment management firm.