Trends in the Expenses and Fees of Funds, 2025

ICI

Research

19 Pages

Investment Company Institute reviews how fund fees kept drifting lower in 2025 as investors continued favoring cheaper structures and index products. The bigger point is that fee compression now looks less like a one time shift and more like a long running industry migration, with index mutual funds and ETFs rising from 19% to 52% of long term fund and ETF assets since 2010.

Key Takeaways

Fee Compression Continued: Since 1996, average expense ratios fell 62% for equity mutual funds and 57% for bond mutual funds, showing how persistent the fee decline has been.
Low Cost Won Flows: In 2025, 92% of gross sales of long term mutual funds went to no load funds without 12b 1 fees, up from 46% in 2000.
Indexing Took Share: Index mutual funds and ETFs grew from 19% of long term mutual fund and ETF net assets in 2010 to 52% by year end 2025.
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