Many financial planners recommend that investors choose a mutual fund with an expense ratio that is:

Question

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Expense ratios are a measure of the cost of investing in a mutual fund, and lower expense ratios are generally preferred because they reduce the fund's operational costs, leaving more money available for investment. A ratio of 1 percent or less is often recommended as it indicates a more cost-efficient fund, allowing investors to keep a larger portion of their returns.

Many Financial Planners Recommend That Investors Choose a Mutual Fund