According to data from Bloomberg Intelligence and industry insiders, the average expense ratio for new ETFs has risen to 0.63%, the highest since 2010, reflecting intense fee competition in the industry. While low fees benefit investors, it poses a challenge for issuers. Recent data shows that about one-third to half of US-listed ETFs may not cover operating costs. The fee competition in the ETF market is evolving into demand for high-fee, high-profit products. Meanwhile, the mutual fund industry is facing a challenge of sustained net closures as investors turn to more cost-effective ETFs. The mutual fund industry is trying to adapt to this change in various ways, but mutual funds still have an advantage in the US pension system.