Jim Scheinberg was quoted today in an article by Daily Finance, an AOL money & finance site, entitled “Mutual Fund Fees Debate: Much Ado About Nothing?”
Some would argue that international, emerging market and other specialty-sector funds require more in depth research and therefore should be more expensive. “You have to pay for talent,” says Jim Scheinberg, managing partner of North Pier Fiduciary Management. A manager’s prowess could be linked to the resources they expend, thus impacting their costs and net fee. For example, if one small-cap manager has three analysts for a $500 million portfolio and one manager has 10 for the same sized portfolio, the second manager’s costs, and the resultant fees, are going to be higher; but in theory, their coverage of their market should be better. “Would this justify a higher fee? If their performance was stronger, we think so,” says Scheinberg.