An Overview of the U.S. Regulated Fund Industry
The largest segment of the asset management business in the United States is registered investment companies (regulated funds). This article focuses on U.S. regulated investment companies—mutual funds, exchange-traded funds, closed-end funds, and unit investment trusts. These funds manage more than $17 trillion of assets, largely on behalf of U.S. investors. The industry has experienced strong growth over the past quarter century from asset appreciation and strong demand from households due to rising household wealth, the aging of the U.S. population, and the evolution of employer-based retirement systems. Price competition and supply-side product innovations and efficiencies have reduced the average price that investors pay for fund services.
ICI Research Perspective: Trends in the Expenses and Fees of Mutual Funds, 2012
This study examines recent trends in the expenses and fees of mutual funds. Expense ratios of equity, bond, and hybrid funds declined in 2012 owing to reductions in the expense ratios of individual funds, an increase in the demand for index funds, and a continuing shift by investors in both actively managed and index funds toward lower-cost funds. Expense ratios of money market funds declined sharply as assets migrated toward lower-cost funds and funds continued to waive large portions of expenses. Waiving expenses helps offset the effects of the current low interest rate environment on a fund’s net yield. Expense ratios of target date mutual funds were 58 basis points in 2012, down from 67 basis points in 2008. Two factors likely played a role. First, assets in target date mutual funds have tripled since 2008, lowering fund expense ratios through economies of scale. Second, a greater concentration of assets in lower-cost target date mutual funds pushed down the average expenses of these funds.
Conserved Quantities of a Class of Nonlinear Difference-Difference Equations
Higher-order conserved quantities of a class of nonlinear difference-difference equations which are related to the discrete-time Toda equation are obtained using the Miura transformations.