Impact of Rising Expense Ratios

A lot has happened since the Sebi notification of September 26,2012, wherein it allowed AMCs to charge additional TER (total expense ratio) depending on the extent of net inflations from locations beyond the top 15 cities. We analysed the declared expense ratios across fund categories as on Sep 30,2012 and Sep 30, 2013 and found that the expense ratios of all equity fund categories increased by as much as 26 per cent while the expense ratios of fixed income categories declined by up to per cent. Select fund schemes like IDBI Top 100 Equity, LIC Nomura MF Growth, Principal Tax Savings, Birla Sun Life Frontline Equity have in fact witnessed more than 30 per cent increase in their expense ratios.