Exchange-traded funds (ETFs) have been one of the fastest-growing investment products in recent years,attracting millions of investors with their trading flexibility and low expenses. But as more and more of these funds are rushed to market, expenses on some ETFs have begun to creep upward. In fact, some ETFs now charge more than many actively managed mutual funds. Why are some of these funds so expensive?
Forecast: rising expenses
Using Morningstar's online screening tool, you can find dozens of ETFs that clock in with huge expense ratios of 0.95% or more. With many active funds charging 1% or less, these ETFs seem more costly than they should be.