> The author estimates that the NYC pensions were paying a roughly 0.25 fee on their funds.
Where does it say that? I just did search on the web page and the string "25" doesn't appear anywhere.
Perhaps you're rounding up from this number: "total fees of about 0.24 percent a year on all assets, including private assets."
If you are, you're not comparing like with like. The closest equivalent in the article to your index funds is this: "The fees that NYCERS pays for U.S. domestic public equities are about 0.08 percent a year".
So we're now comparing 0.05% for an index fund vs 0.08% for "US domestic public equities", which almost certainly includes actively-managed funds, which incur higher fees than an index fund (e.g. Vanguard's average active fund expense ratio is 0.27%[1] vs 0.13% for index funds[2]), which would explain the 0.03% difference.
Where does it say that? I just did search on the web page and the string "25" doesn't appear anywhere.
Perhaps you're rounding up from this number: "total fees of about 0.24 percent a year on all assets, including private assets."
If you are, you're not comparing like with like. The closest equivalent in the article to your index funds is this: "The fees that NYCERS pays for U.S. domestic public equities are about 0.08 percent a year".
So we're now comparing 0.05% for an index fund vs 0.08% for "US domestic public equities", which almost certainly includes actively-managed funds, which incur higher fees than an index fund (e.g. Vanguard's average active fund expense ratio is 0.27%[1] vs 0.13% for index funds[2]), which would explain the 0.03% difference.
1: https://investor.vanguard.com/mutual-funds/actively-managed
2: https://investor.vanguard.com/mutual-funds/index-funds