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A Guide to Analyzing ETF Performance

Understand the key metrics for evaluating Exchange-Traded Funds and how to compare them effectively.

Compare ETFs Side-by-Side

Our ETF Performance Calculator allows you to estimate and compare returns for two different ETFs, factoring in fees and commissions to see the real-world difference.

Use the ETF Performance Calculator
What is an ETF?

An Exchange-Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like stocks. ETFs hold a basket of assets, such as stocks, bonds, or commodities. They are a popular choice for investors because they offer diversification and generally have lower fees than traditional mutual funds.

For example, an S&P 500 ETF holds stocks of the 500 largest U.S. companies, allowing you to invest in a broad slice of the market with a single purchase.

Key Metrics for Comparing ETFs

When comparing ETFs, a few metrics are crucial:

  • Expense Ratio: This is the annual fee charged by the fund to cover its operating costs. A lower expense ratio means more of your money stays invested and working for you. Even a small difference in fees can have a huge impact over the long term.
  • Expected Annual Return: This is an estimate of the fund's growth potential. While past performance doesn't guarantee future results, it can be a useful guide.
  • Trading Commission: Some brokerage platforms charge a fee to buy or sell an ETF. Our calculator helps you see how these commissions can affect your returns, especially if you invest frequently.
How to Use the Calculator

Our tool makes it easy to see the potential difference between two investment choices. For each ETF, provide:

  • An optional name for easy identification.
  • Your initial and monthly investment amounts.
  • The expected return and expense ratio for the fund.
  • Any commission fees for trading.
  • Set a common investment period, and the calculator will project the growth of both funds, showing you a clear visual and numerical comparison.