The Hidden Cost of Active ETFs: How Fees Erode Returns
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BTCCSquare news:
Actively managed exchange-traded funds promise outperformance but often deliver disappointment. The allure of beating benchmarks like the S&P 500 fades when fees consume potential gains. Data from the SPIVA scorecard reveals 80%-88% of active funds underperform over a decade—a direct consequence of compounding costs.
A 1% annual fee can slash long-term portfolio value by over 70% compared to a 0.10% expense ratio. This silent wealth killer disproportionately impacts investors chasing alpha through active management. The math is unforgiving: what appears as minor fee differentials magnify into generational wealth gaps across 45-year investment horizons.
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