What is a high expense ratio for an ETF


I want to build a personalised portfolio…

Does anyone know the reasonable price for an ETF?

How do you calculate the annual management charge calculation? (ETFs, Index Funds, Mutual Funds)

Asking the proper price for an ETF, is similar to the question how long is a piece of string…

I think a good question is…what are you paying for…

If the ETF offers an opportunity which is difficult to offer (e.g. farmland REIT), it will be more expensive (1%+)

If the ETF tracks a well-known index, then a 1% charge will be outrageously expensive because index funds usually offer the same services at a far cheaper rate

For me personally…

• If the fund does not offer something exceptional and it does not always beat the market… anything over .65% is expensive.

• If the fund offers a very unique opportunity, into an asset class which is not often securitised (water infrastructure)… anything over 1.5% would be expensive

Side note: look for hidden charges such as…

• Trading charges
• Performance fees
• Mutual fund fees if you have a fund manager…

Often times, a fund with 1% annual fee has many hidden charges…

Good luck!


Agree with everything said above…

If you want to see how much you are paying, google:

“Calculate the hidden cost of fund fees ft”

You will be able to find an excellent fees calculator on the Financial Times website.

Would highly recommend!


I will also ad that Morning Star calculated that the average ETF expense ratio in 2016 was .6%, which compares with .73% for index mutual funds and then 1.45% for actively managed funds as well!

link: https://www.fidelity.com/learning-center/investment-products/etf/etfs-cost-comparison