June 07 , 2012
The Fund Management Charge is a charge levied by companies that invests your money in the markets. ULIPs and mutual funds have this charge. It is quoted as a percentage of your returns.
As would be logical, actively managede quity funds where the fund manager has to set up a portfolio of shares, have higher fund management charges (about 2%-2.5%). A simple index fund (one whose composition is a plain replica of an index such as sensex) would have a lower charge (0.5%-1%). A debt fund would often have even lower charge (0.2%-0.5%).