The following figure illustrates a one year gross of expense return using the Annual Ratio methodology. For simplicity, the example is based on monthly NAVs. Distributions are not included. Note that the annual ratio is assumed to be 2.25% for the first half of the year and then changes to 1.75% starting in July. Also note that this represents a monthly accrual method (monthly versus daily accrual processing is described later in this document).
Note:
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| The expense adjustment (reinvestment of the monthly accrual) occurs at each month end. |
The example in the following figure ignores distributions for purposes of simplicity. Had there been a distribution during the month, its affect is recognized in the next (and subsequent) day's daily accrual.
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