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Unformatted text preview: Analysis” box shown on the left in Figure 4.5 provides some evidence on the tax efficiency of the fund.
The after- tax return, given in the first column, is computed based on the dividends paid to the portfolio as well as
realized capital gains, assuming the investor is in the maximum federal tax bracket at the time of the distribution.
State and local taxes are ignored. The tax efficiency of the fund is measured by the “Tax- Cost Ratio,” which is an
estimate of the impact of taxes on the investor's after- tax return. Morningstar ranks each fund compared to its
category for both tax- adjusted return and tax- cost ratio.
The bottom of the page in Figure 4.5 provides information on the expenses and loads associated with
investments in the fund, as well as information on the fund's investment adviser. Thus, Morningstar provides a
considerable amount of the information you would need to decide among several competing funds. textflow.mcg r aw- hill.com//par ser .php?secload= 4.8&fake&pr int 4/4...
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This note was uploaded on 08/15/2013 for the course ECON 4000 taught by Professor Arkonac during the Summer '11 term at CUNY Baruch.
- Summer '11