Editing Index fund (section)

===Low costs===
Because the composition of a target index is a known quantity, relative to actively managed funds, it costs less to run an index fund.<ref name="ssrn.com"/> Typically expense ratios of an index fund range from 0.10% for U.S. Large Company Indexes to 0.70% for Emerging Market Indexes. The expense ratio of the average large cap actively managed mutual fund as of 2015 is 1.15%.{{Cn|date=February 2025}} If a mutual fund produces 10% return before expenses, taking account of the expense ratio difference would result in an after expense return of 9.9% for the large cap index fund versus 8.85% for the actively managed large cap fund.  Similarly, if a mutual fund produces only a 1% return before expenses, taking account of the expense ratio difference would result in an after expense return of 0.9% for the large cap index fund versus a 0.15% loss for the actively managed large cap fund.