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The fund management fees for unit trust is 1% and for bonds only 0.5% . Why?


Can u tell me whether am i paying too much for fund management fee of 1%? where thr 1% goes to?

It seems that the skills and resources needed to manage equity unit trust is higher than than of bond due to market size and volatility. The management fees would be used to pay for the salary of the management staff and the data sources.
Is 1% too much? If the unit trust is making say 9% over the long term versus another instrument of same risk that makes 5% and no fees, which do you think is better?
A friend of mine once asked me which investment charges the highest fee? His answer - the bank's savings account. The bank probably earns more than 5% on your savings but only gives you 0.3%. But its no risk right? Wrong, since inflation is more than 2%, the savings account is losing money all the time - guaranteed!

Why is everyone so transfixed on fees? If it were really only about fees all we would have to do is pick the investment with the lowest fees and we would all be rich! Right! Your comments are welcome.

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