Do Investors Benefit From MiFID II Unbundling?

51 Pages Posted: 26 Jul 2021 Last revised: 21 Feb 2023

See all articles by Emelie Fröberg

Emelie Fröberg

Stockholm School of Economics

Michael Halling

University of Luxembourg

Date Written: July 23, 2021


One prominent aspect of the MiFID II regulation that became effective in Europe in 2018 is the unbundling of research and execution costs. We exploit the early adoption of an unbundling rule in Sweden already in 2016 to provide evidence on the implications for fund investors. Using a difference-in-difference framework and mostly hand-collected data on bundled and unbundled commissions, we find no positive impact of the regulation on fund investors: neither total expense ratios nor fund performance improved for the average fund in response to the unbundling. When we split the sample into more active and less active funds, using the Active Share measure, we document heterogeneous effects of unbundling on fund costs. Still, we fail to identify any information gains for investors’ fund selection process from the increased transparency of observing execution and research costs separately. Overall, we are skeptical that the unbundling of commissions has had a positive impact on fund investors.

Keywords: Financial Intermediation, Mutual Funds, MiFID II, Unbundling

JEL Classification: G11, G23

Suggested Citation

Fröberg, Emelie and Halling, Michael, Do Investors Benefit From MiFID II Unbundling? (July 23, 2021). Available at SSRN: or

Emelie Fröberg (Contact Author)

Stockholm School of Economics ( email )

PO Box 6501
Stockholm, 11383

HOME PAGE: http://

Michael Halling

University of Luxembourg ( email )

L-1511 Luxembourg

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