A good rule of thumb is anything under . 2% is considered a low fee and anything over 1% is high, according to many experts. The higher the expense ratio, the more it'll eat into your returns. One of the most important factors that affect the expense ratio of a fund is whether it's actively or passively managed.
Are ETFs expense ratios high?
In general, the expense ratios for mutual funds tend to be higher than for ETFs. While ETF expense ratios top out at no more than 2.5%, mutual fund costs can be significantly higher.
Which fund would have the least expense ratio?
An index mutual fund is a type of fund that invests all, or nearly all, of its total assets in securities comprising its underlying index. Index funds use passive investment strategies and thus tend to have low turnover and low expense ratios.
What ETF has the lowest expense ratio?
Symbol Name Expense Ratio
------ -------------------------------------------- -------------
VOO Vanguard S&P 500 ETF 0.03%
STIP iShares 0-5 Year TIPS Bond ETF 0.03%
ITOT iShares Core S&P Total U.S. Stock Market ETF 0.03%
SPAB SPDR Portfolio Aggregate Bond ETF 0.03%
Which family of funds has the lowest expense ratios?
Vanguard is probably best known for their wide selection of low-cost index funds, which are known for having the lowest Expense Ratios in the universe of mutual funds.
Why are ETF expense ratios so low?
Plain and simple, ETFs are cheaper than mutual funds because they do not charge 12b-1 fees; fewer operational expenses translates into a lower expense ratio for investors.
What is considered a low expense ratio for ETF?
The expense ratio is the annual cost paid to fund managers by holders of mutual funds or ETFs. A reasonable expense ratio for an actively managed portfolio is about 0.5% to 0.75%, while an expense ratio greater than 1.5% is typically considered high these days.
What is the average expense ratio for an ETF?
The average ETF carries an expense ratio of 0.44%, which means the fund will cost you $4.40 in annual fees for every $1,000 you invest. The average traditional index fund costs 0.74%, according to Morningstar Investment Research.
What funds have the lowest expense ratio?
Index Fund Expense Ratio
------------------------------------------------------------- -------------
iShares Core S&P Total U.S. Stock Market ETF (ITOT) 0.03%
Vanguard S&P 500 ETF (VOO) 0.03%
Vanguard Total Stock Market ETF (VTI) 0.03%
Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) 0.04%
What is the lowest fee S&P 500 ETF?
The S&P 500 ETFs with the lowest fees are IVV, VOO, and SPLG. The highest-liquidity ETF is SPY.
What is a low expense ratio for an index fund?
A reasonable expense ratio for an actively managed portfolio is about 0.5% to 0.75%, while an expense ratio greater than 1.5% is typically considered high these days. For passive or index funds, the typical ratio is about 0.2% but can be as low as 0.02% or less in some cases.