Businessman hand showing financial report on table

Thirteen major U.S. mutual fund companies have agreed to begin publishing data about how actively their funds are managed, following an investigation by the office of the attorney general of New York (NYAG) into the practice of “closet indexing,” NYAG announced Thursday.

A report published by NYAG’s Investor Protection Bureau, Mutual Fund Fees and Active Share, details the findings of the investigation into fees charged by actively managed mutual funds, their disclosures to investors, and their portfolio composition relative to their fees.

The investigation found that actively managed funds are much more expensive than index funds, but that higher fees don’t necessarily correlate with more active management.

It also found that data on “active share” is not generally disclosed to retail investors. “In other words, individual investors do not have access to certain information that would allow them to assess whether the fees they are paying are acceptable in light of a particular fund’s overlap with its benchmark,” the report says.

BlackRock, Inc., The Capital Group Companies, Inc., T. Rowe Price Associates, Inc., The Vanguard Group, Inc., and others have agreed to start publicly posting active share data on a quarterly basis, NYAG says.

Fidelity Management & Research Co., another firm that was reviewed, is already publishing the information.

“The firms will disclose new information that can help retail investors determine whether a higher-cost, actively managed mutual fund fits their investment goals better than another, lower-cost alternative,” NYAG says in a news release.

“These new disclosures will give Main Street investors access to critical information before making investment decisions for themselves and their families,” says Attorney General Eric Schneiderman, in a statement. “By working with us to help level the playing field for all investors, these firms are taking an important step forward. I encourage all mutual fund firms to follow suit.”