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MPF intermediaries
MPFMPF Intermediaries ExaminationA constituent fund of $400 million invests through an APIF. In the year, fund-level expenses are $2.4 million and APIF-level fees and charges are $1.2 million. What is the fund's FER?
Answer: 0.9%. FER = total expenses, including APIF-level charges, as a percentage of fund size: ($2.4m + $1.2m) / $400m = 0.9%.Working:1. Total expenses = $2,400,000 + $1,200,000 = $3,600,000.2. FER = $3,600,000 / $400,000,000 = 0.9%.Why not the others:• 0.09%: this misplaces the decimal point.• 0.3%: this counts only the APIF-level charges.• 0.6%: this leaves out the APIF-level charges.Watch out: Candidates forget the APIF-level charges.Rule: Add both layers before dividing.Source: MPF Study Notes, Tenth Edition (June 2026), 5.10(d)
Candidates forget the APIF-level charges.
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