Dimensional to Cut Management Fees on 77 U.S. Mutual Funds

28 Dec    Investing News

(Bloomberg) — Dimensional Fund Advisors plans to reduce fees on 77 U.S. mutual funds, joining an industrywide push to lure customers with lower-cost investments.

Average management fees will be cut 8% on an asset-weighted basis, the company said in a statement Monday. The changes go into effect on Feb. 28.

Asset management firms have slashed what they charge clients in an effort to compete with inexpensive index funds. Fidelity Investments has introduced several zero-cost funds and Charles Schwab Corp. set off a shakeout in the sector this year by offering free stock trading.

Read more: Schwab muscles its way to the top with zero fees

“We expect to do better than benchmarks and peers, after fees, so we fight for every basis point,” Gerard O’Reilly, Dimension’s co-chief executive officer and chief investment officer, said in the statement.

Dow Jones earlier reported the changes.

Read more: QuickTake on how zero-cost investing caught on

Here are some more details:

  • Dimensional said the new charges would apply to several of its most widely held funds including those in the flagship core, value and fixed-income portfolios
  • The firm said it trimmed U.S. management fees or expense caps in 2015, 2017 and earlier this year
  • See the full list here
  • Dimensional manages $579 billion in assets

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