What really matters to mutual fund investors?

Fees, past performance, and risk tolerance are the dominant factors driving mutual fund purchase decisions among American households, according to new survey data that offers a detailed picture of how retail investors evaluate their options.

The Investment Company Institute’s Annual Mutual Fund Shareholder Tracking Survey, conducted across a nationally representative sample of more than 9,000 households, found that 72.7 million US households (roughly 54% of the country) held mutual funds in 2025. The newly-released results show investors arriving at purchase decisions armed with a consistent checklist of criteria, with costs and returns sitting near the top.

"Investors continue to choose mutual funds because of their flexibility, diversification, cost-effectiveness, and professional management," said Shelly Antoniewicz, ICI's chief economist. "Retirement savers are not the only ones benefiting from these attractive investment vehicles. In 2025, 72% of mutual fund–owning households held mutual funds outside employer-sponsored retirement plans underscoring the role mutual funds play in helping families save for education, homeownership, and retirement."

Fund fees and expenses ranked among the most scrutinized factors, with more than nine in 10 mutual fund–owning households reporting they reviewed costs before buying.

Nearly half called fees very important to their final decision and that emphasis on price appears to translate into behavior as fund investors incurred an asset-weighted average expense ratio of 0.40% on equity mutual funds in 2025, less than half the industrywide simple average of 1.09% across all equity funds available in the United States.

Performance metrics

Of mutual fund–owning households, 95% said they examined a fund's track record, with 48% calling it very important; 95% also weighed performance against a benchmark index, though fewer, 38%, elevated that comparison to the very important category.

Ratings from third-party services drew less scrutiny, with only 19% calling them very important, a gap the ICI attributes in part to the role financial advisers play in pre-screening fund options before clients ever enter the selection process.

Some 95% of households reviewed the risk profile of a fund's holdings before purchasing, and 93% looked at the investment objective. Forty percent flagged risk level as very important — slightly ahead of the 33% who said the same about investment objectives.

The survey also captured investor sentiment around the structural appeal of mutual funds as a vehicle. Cost effectiveness and diversification were cited as important by more than nine in 10 households, and professional management drew similarly broad appreciation, with 35% calling it very important and another 43% calling it somewhat important.

Equities skew

The universe of households doing this research skews toward equity exposure. Some 81% of mutual fund–owning households held equity funds, by far the most widely owned category.

At year-end 2025, more than half of the $27.4 trillion households held in mutual fund assets was concentrated in equity strategies; 44% in domestic equity funds and 12% in world equity funds.

Of the 19.8 million US households that owned ETFs in 2025 (about 15% of all households) 97% said fees and expenses factored into their purchase decision, with 54% calling them very important, a slightly higher share than among mutual fund buyers.

Historical performance drew nearly identical engagement, with 49% rating it very important. As with mutual fund owners, ETF holders cited cost effectiveness, diversification, and intraday liquidity as the vehicle's core attractions.

A majority of mutual fund–owning households (73%) held funds through an employer-sponsored retirement plan. But a substantial share also owned funds outside those plans, with about half purchasing through an investment professional and roughly three in 10 going through the direct market channel, which includes fund companies and discount brokers.