SAN DIEGO (ETFguide.com) -
During
the third quarter the expense ratios in most ETF categories increased
modestly or remained the same from the second quarter.
The
industry and sector group
had 157 funds
making it the largest ETF category. The expense ratio average of this group
stayed level at 0.52 percent. The Select Sector SPDRs, which is included in
this group reduced annual expense ratios from 0.24 to 0.23 percent.
The fixed
income area has been one of the most active for new products. The number of
bond ETFs began the year at 14 and has since risen to 34 funds.
Competing municipal
bond funds were launched by Barclays Global Investors and State Street
Global Advisors last week.
The average
expense ratio for all fixed income ETFs was 0.19 percent.
Many
recently launched ETFs have been introduced with fee waivers that
temporarily reduce expense ratios for a specified period of time, usually 1
to 2 years. Fund families will typically retain the right to adjust
investment costs if certain asset thresholds are reached.
Also,
some fund families such as PowerShares, State Street Global Advisors and
others have made allowances to permit 12b-1 distribution fees on selected
ETFs. While no such costs have yet been charged, it could increase the
investment costs of owning such funds.
Merrill Lynch's
HOLDRs were omitted because their cost is not expressed in terms of expense
ratios.
3Q 2007 ETF
Survey
|
ETF
Categories |
Expense Ratio Category Average |
Number of ETFs |
|
Broad Market |
0.39% |
26 |
|
Large Cap |
0.38% |
51 |
|
Mid Cap |
0.35% |
27 |
|
Small Cap |
0.39% |
31 |
|
Industry & Sector |
0.52% |
157 |
|
Global & International |
0.54% |
103 |
|
Emerging Markets |
0.62% |
22 |
|
Fixed Income |
0.19% |
34 |
|
Commodity |
0.70% |
17 |
|
Currency |
0.45% |
14 |
|
Specialty |
0.89% |
70 |
|
Industry Totals/Average |
0.49% |
552 |
Source:
ETFguide.com
