Watch Out for Rising Fees at These 5 Funds

Expense ratios are the best predictors of future success. They tend to be relatively stable, but they can move around more with funds that see big changes in size. So naturally, it pays to track fee changes at your funds.

I looked to see which funds have seen the largest increases in their prospectus-adjusted expense ratios. That figure tells you what the fund was charging as of the most recent prospectus date. That makes the number more recent than the annual report expense ratio, which tells you what the fund was charging over the 12 months that ended on the date covered by the annual report. That can get kind of stale.

We also adjust fees for leverage and shorting costs because those are incurred as part of the execution of the strategy and are not fees charged by management.

Let’s see which funds have rising fees.

American Beacon AHL TargetRisk AHTPX saw fees pop 13 basis points to 1.53%. That’s a pretty hefty cost. Systematic-trend funds like this one tend to be expensive because they operate in a hedge fund-like space that requires top quantitative investors. The fund follows an array of price trends using futures trades. Poor performance in 2023 and 2025 spurred outflows, and that nudged fees higher. We recently downgraded its People rating to Above Average because of some key departures. The fund now has a Morningstar Medalist Rating of Neutral.

Bronze-rated T. Rowe Price Global Allocation RPGAX saw fees rise to 1.01% from 0.96%. The fund has had a steady trickle of outflows that may explain the increase in fees. Funds have management-fee breakpoints that serve as a way to share economies of scale with fundholders. So, as funds get larger and trip those breakpoints, fees will come down. Unfortunately, those breakpoints work in both directions, so fees rise when assets fall.

Morgan Stanley Institutional Growth MSEGX has seen $1.3 billion in outflows in the past 12 months, and its expense ratio popped 5 basis points to 0.87% as a result. The fund has actually had strong returns in recent years, but a huge loss in 2022 seems to have turned the tables on flows, even with the robust rebound. We rate the fund Bronze, but its extreme returns suggest you should research carefully before investing.

Five consecutive years of underperformance will spur outflows. Artisan Global Opportunities ARTRX has seen $745 million leave in the past year, and expenses rose to 1.19% from 1.15%—about 28 basis points above the Morningstar Category median. That’s a shame because we do think the fund’s People and Process Pillars merit Above Average ratings. Lower fees would certainly help the appeal here.

We return to American Beacon for our final fund. American Beacon AHL Managed Futures AHLAX saw its prospectus-adjusted expense ratio rise 3 basis points to a steep 1.92%. Assets are currently $1.9 billion, down from $3.6 billion in 2022. In relative terms, the fund’s 4% annualized loss over the past three years hasn’t been that bad, but alternative investors hate red numbers as much as other investors, so the fund has seen many walk out the door. We lowered the People rating here, too, to Above Average from High. There are clearly some positives here, but it’s a challenge to overcome that fee hurdle. Overall, the fund is rated Neutral.

This article first appeared in the November 2025 issue of Morningstar FundInvestor. Download a complimentary copy of FundInvestor by visiting this website.