When choosing an index fund manager to manage your clients' investments, it may be tempting to simply pick the investment product with the lowest management fee. However, not all index funds are created equal.
Fees are one of many considerations. This is especially the case today with fees highly compressed across the industry. While expense ratio differences of 80, 50, or even 20 basis points can have a significant impact on a fund’s relative performance, as fees converge, other factors become more important when choosing between funds.