Should You Choose Mutual Funds Based On Expense Ratio? Pooja Bhinde Explains

Expense ratio is an important factor, but it should not be the only reason for choosing a mutual fund. Pooja Bhinde, Certified Financial Planner, PB Investments, explains that passive funds generally have lower expense ratios because they simply track an index, while active funds charge more as professional fund managers aim to generate higher returns. She says investors should evaluate whether an active fund consistently beats its benchmark rather than focusing only on costs. A balanced mix of active and passive funds can help build a stronger portfolio.