ETF Expense Ratio Calculator

Calculate ETF Expense Ratio



Formula

To calculate the Expense Ratio:

\[ \text{Expense Ratio} = \left(\frac{\text{Total Fund Expenses}}{\text{Average Net Assets}}\right) \times 100 \]

Where:

What is an ETF Expense Ratio?

An ETF (Exchange Traded Fund) expense ratio is a measure of what it costs an investment company to operate an ETF. It includes various operational costs such as management fees, administrative services, record keeping, and custodial services. The expense ratio is calculated by dividing the fund’s operating expenses by the average dollar value of its assets under management (AUM). It is expressed as a percentage and deducted from the fund’s assets, reducing the return to investors.

Example Calculation

Let's assume the following values:

Using the formula:

\[ \text{Expense Ratio} = \left(\frac{500,000}{100,000,000}\right) \times 100 = 0.50\% \]

The Expense Ratio is 0.50%.