The negative impact of mutual fund fees on investor returns is highlighted in a report published Tuesday from the European Securities and Markets Authority (ESMA).

In the report, ESMA sees geopolitical uncertainty, the resilience of economic growth, and elevated debt levels, as the primary risk drivers affecting financial markets in the second half of 2017.

“Market and credit risks, as a result of geopolitical, growth and debt concerns, continued to be very high, while liquidity and contagion risks remained stable but high,” ESMA says in a statement. Operational risk, remains elevated, but that the outlook is now negative, “due to heightened concerns around cybersecurity,” ESMA adds.

The report also highlights the impact of mutual fund fees and other changes on investor returns.

“Preliminary evidence for the EU fund industry suggests that on average ongoing fees and one-off charges and inflation reduced returns available to investors by 29% of gross returns between 2013 and 2015,” the report says.

The negative impact of fees on investor returns varies across jurisdictions, asset classes and client types, the report finds. For example, fees only reduced returns on passive equity funds by 11%, but they slashed returns for retail bond mutual funds by 44%, the report says. In general, fees had a bigger impact on actively managed funds compared with passively managed funds.

Regardless of the significant impact of fees, investors generally don’t seem to consider them when making investment decisions, the report finds.

“Despite the impact of fees and charges on the net outcome to investors, these do not seem to be reflected in investor choices, with preliminary results showing that aggregate net flows to EU fund shares react hardly at all to management fees, and even less to cost-adjusted net returns,” it says.