Foregone earnings represent the difference between an investment's actual earnings and the earnings that could have been realized had there been no fees. ... Sales charges and operating fees, incurred by an investor in a mutual fund, are examples of investment fees that lead to foregone earnings.

What is forgone opportunity cost?

Key Takeaways. Opportunity cost is the forgone benefit that would have been derived from an option not chosen. To properly evaluate opportunity costs, the costs and benefits of every option available must be considered and weighed against the others.

Is forgone revenue a cost?

The term “foregone earnings” is a lost opportunity or opportunity cost as the investment capital that is lost to fees could have also generated additional return.