Asset classes

The five factors that make up total ETF costs

March 07, 2024

A divided horizontal bar illustrates five categories of ETF costs, with the bar sections varying in size to signify the relative importance of each cost. The first section, ETF expense ratio, makes up about half the total cost of an ETF. The second section, ETF spread, makes up about one-fifth of the total cost. Each of the three other costs—premium/discount volatility, tracking error, and execution costs—makes up about one-tenth of an ETF’s total cost.
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