What is Tax Cost Ratio?

Mutual funds are required to distribute all dividends and capital gains to their shareholders, regardless of when an individual investor purchased the fund. Tax Cost Ratio measures how much a fund's annualized return would be reduced by the taxes on distributions. Tax Cost Ratio only impacts funds held in taxable accounts.

Have more questions? Please Sign In to submit a request
Was this article helpful?
7 out of 9 found this helpful