3 ms·
Not sure I'm following the "more like 14%" ... can you explain that calculation?
by okhobb 5y ago
Not sure I'm following the "more like 14%" ... can you explain that calculation?
- rodonn 5y agoYou have $1m and on average it will earn 7% per year. The fee is 1% of the $1m ($10k), but it is 14% of your expected gains per year (1%/7%). After fees your portfolio will go up by 6% per year instead of 7%, which is a substantial reduction.
- ryankshaw 5y agohere's an example: say you have $100k invested the 1% fee for that will be $1k the earnings will be $7k so the "1%" fee takes away 14% ($1k is 1/7th, or 14%, of $7k) of your earnings.