Financial metrics2 min read
Total expense ratio (TER)German: Gesamtkostenquote (TER)
The total expense ratio measures certain ongoing fund expenses relative to its average assets per year.
In plain language
Expenses are borne by the fund and reflected in its share value. TER does not cover every cost. Transaction costs, personal trading charges and taxes may be additional, so it is not a complete all-in cost measure.
Let’s make it concrete
At a constant €10,000 holding value and 0.20% TER, the stated ongoing costs are an illustrative €20 per year.
Simplified example for illustration.Worth understanding
A lower TER does not guarantee better index replication. Look at actual tracking difference as well.
Read more from official sources
For further learning and reference:
Financial education for orientation. No individual investment, tax or legal advice.
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