ETFs and Associated Costs

Types of Costs and Their Impact

Exchange-traded funds (ETFs) and mutual funds both incur costs that can reduce the value of an investment. ETFs are generally considered low-cost, particularly those offered by Vanguard. However, it's important to be aware of additional costs, such as the activity assessment fee of 0.01 to 0.03 per $1,000 of principal on sell orders.

Index funds, which can be structured as mutual funds or ETFs, also incur costs. It's important to clarify the distinction between index funds and other types of funds to understand the associated costs.

Fidelity Investments and ETF Fees

Fidelity Investments is actively negotiating with ETF firms to implement listing and maintenance fees. This move is intended to generate revenue for Fidelity, but may ultimately increase costs for investors.

Additionally, some brokers may charge a commission for buying funds. However, it's important to note that Fidelity offers commission-free online trading for US Stock and Exchange Traded Fund (ETF) trades.

Specific ETF Issuers Facing Servicing Charge

Simplify Asset Management, AXS Investments, Day Hagan Sterling Capital, Cambiar, Regents Park, Rayliant Adaptive are among the ETF issuers that may face a new servicing charge.