ETF glossary

The fund's own annual charge, deducted continuously from its assets rather than billed to you. Quoting it as euros per €10,000 makes it comparable with the other costs of ownership: 0.20% is €20 a year. It is the most visible cost of a fund, which is not the same as the largest.

Calculators: TER impact calculator: what an ongoing charge costs over time, ETF cost calculator: every annual cost of holding one fund
Guide: The total cost of owning an ETF — all four charges, not just the TER

The European regulatory term for what most people call the TER. It appears on the Key Information Document and includes management and administration costs, but excludes transaction costs incurred inside the fund and any performance fee.

Guide: The total cost of owning an ETF — all four charges, not just the TER

What the fund actually delivered against its index over a period, as opposed to what it said it would charge. It can be smaller than the ongoing charge — securities lending income and favourable tax treaties both close the gap — and occasionally negative, meaning the fund beat its index. It is the honest measure; the ongoing charge is a proxy for it.

Calculators: Tracking difference vs TER: what an ETF really costs
Guide: The total cost of owning an ETF — all four charges, not just the TER

The volatility of the gap between fund and index, not its size. A fund can have a large tracking difference and a small tracking error if it lags by a consistent amount. The two are routinely confused, and it is the difference that costs you money.

Calculators: Tracking difference vs TER: what an ETF really costs

The gap between the price you can buy at and the price you can sell at, crossed once on the way in and once on the way out. It is a real cost that appears on no statement, and it widens for thinly traded listings — which is why the same fund can be more expensive to trade on one exchange than another.

Calculators: Which ETF listing to buy, and the 0.1% currency fee to avoid, ETF cost calculator: every annual cost of holding one fund

An annual charge levied by your broker for holding the assets, usually a percentage of the balance and sometimes capped. It scales opposite to per-trade commission: negligible on a small portfolio, dominant on a large one, which is why the cheapest broker changes as you grow.

Calculators: ETF broker comparison for the Netherlands, Germany, Belgium and Italy
Guide: Choosing a broker — the costs that depend on how you invest

What your broker charges per trade. Being a fixed cost on a variable amount, its percentage impact is set entirely by your order size — two euros is 0.1% of a €2,000 purchase and 2% of a €100 one, which makes contribution frequency a cost decision rather than a habit.

Calculators: ETF broker comparison for the Netherlands, Germany, Belgium and Italy, Broker break-even: the amount where the cheapest broker changes
Guide: Choosing a broker — the costs that depend on how you invest

What your broker takes for converting currency when you buy a listing denominated in something other than your account currency — on the way in, on each distribution, and on the way out. Entirely avoidable by choosing a euro-denominated listing of the same fund, and invisible on the trade confirmation.

Calculators: Which ETF listing to buy, and the 0.1% currency fee to avoid
Guide: Choosing a broker — the costs that depend on how you invest

A broker's list of funds tradeable without commission, usually with conditions attached — a minimum order size, a frequency limit, or one eligible exchange. For a monthly investor a fund on such a list can be materially cheaper to own than a fund with a lower ongoing charge that is not.

Calculators: ETF broker comparison for the Netherlands, Germany, Belgium and Italy, ETF screener for European UCITS funds
Guide: Choosing a broker — the costs that depend on how you invest

The trade size or holding period at which two cost structures cross — a commission-free platform with a percentage custody fee against a per-trade broker, say. Because the two scale in opposite directions there is always such a point, and locating it is more useful than comparing headline tariffs.

Calculators: Broker break-even: the amount where the cheapest broker changes
Guide: Choosing a broker — the costs that depend on how you invest

The European regulatory framework for retail funds. It matters practically rather than theoretically: most European brokers cannot sell you a US-domiciled ETF at all, because those funds do not publish the Key Information Document European rules require. The US funds written about in American articles are usually not purchasable, and the UCITS equivalent is what you actually buy.

Calculators: ETF screener for European UCITS funds

The country the fund itself is established in, which is usually not where you live and usually not where the assets are. It determines which tax treaties the fund can claim on the dividends it receives — the reason nearly every ETF sold to European retail investors is Irish.

Calculators: ETF screener for European UCITS funds, Dividend withholding tax: the cost taken inside the fund
Guide: The total cost of owning an ETF — all four charges, not just the TER

A share class that reinvests income inside the fund instead of paying it out. Your total wealth is identical to the distributing equivalent before tax; what differs is form, and form is what tax codes respond to.

Calculators: Accumulating vs distributing: the answer changes with your country
Guide: Accumulating or distributing — and why the answer is your country

A share class that pays income out as cash. The fund's value falls by exactly what it pays, so a distribution converts part of your holding into cash rather than adding to it — an intuition worth correcting, because the opposite belief drives a lot of portfolio decisions.

Calculators: Accumulating vs distributing: the answer changes with your country, Dividend income projector — the cost of spending the dividends
Guide: Accumulating or distributing — and why the answer is your country

The fund actually holds the securities in its index, either all of them or a representative sample. The alternative is a swap, and the distinction matters for counterparty exposure, for tax treatment in some jurisdictions, and for how closely the fund can track.

Calculators: ETF screener for European UCITS funds

The fund holds a collateral basket and contracts with a bank to receive the index return. It can track more tightly and can avoid some withholding tax entirely, at the cost of depending on the counterparty. Regulation caps that exposure, but it is a different risk from owning the shares.

Calculators: ETF screener for European UCITS funds

The twelve-character identifier for a security, and the only reliable way to name a fund. Tickers differ per exchange and per data provider for the same fund — this site matches on ISIN because matching on ticker silently dropped funds in production.

Calculators: ETF screener for European UCITS funds

How much the fund holds in total. It matters mainly as a closure signal: very small funds are more likely to be merged or wound up, which is not a loss of capital but is a forced disposal at a time you did not choose, and in several countries that means a taxable event.

Calculators: ETF screener for European UCITS funds

The short standardised disclosure a UCITS fund must publish for retail investors, carrying the ongoing charge, the risk indicator and past performance. It is the document this site quotes figures from, because it is published by the issuer for exactly this purpose.

The fund lends holdings to short sellers and keeps part of the fee, which offsets its costs and can make the realised tracking difference smaller than the headline charge. The fund keeps a share; how much it passes on to investors varies by provider and is disclosed.

Calculators: Tracking difference vs TER: what an ETF really costs

Tax deducted by a company's home country before a dividend reaches the fund. The investor never sees it happen — it reduces the fund's return and appears on no statement. On a global equity fund it is frequently larger than the entire ongoing charge.

Calculators: Dividend withholding tax: the cost taken inside the fund
Guide: The total cost of owning an ETF — all four charges, not just the TER

An index variant that assumes dividends are reinvested after deducting withholding tax at a standard rate, usually 30% for US holdings. An Irish fund claiming its treaty rate of 15% therefore beats an NTR benchmark structurally — which is why some Irish trackers appear to outperform their index.

Calculators: Dividend withholding tax: the cost taken inside the fund, Tracking difference vs TER: what an ETF really costs

The Dutch tax category covering savings and investments. It taxes a DEEMED return rather than your actual one: for 2026, 6.00% assumed on investments, taxed at 36%. A year in which your portfolio fell is taxed exactly as though it had risen, and there is no capital gains tax on a sale.

Calculators: Box 3 calculator — Dutch wealth tax on an ETF portfolio, Purchasing power — what inflation and Box 3 do to cash
Guide: ETF tax in the Netherlands — how Box 3 actually works

The reference date on which Dutch Box 3 assets are valued — 1 January. It is why the timing of a late-year distribution has any relevance at all: cash held across that date is assessed at the lower savings rate rather than the investment rate.

Calculators: Box 3 calculator — Dutch wealth tax on an ETF portfolio, Dividend calendar — when distributions land and why the date matters
Guide: ETF tax in the Netherlands — how Box 3 actually works

The German advance charge on an accumulating fund: 70% of the year's base rate applied to the value at the start of the year, capped at the fund's actual gain, and credited against the bill when you sell. It moves tax forward in time rather than adding to the lifetime total, and a flat or falling year produces nothing at all.

Calculators: Vorabpauschale calculator — German advance tax on accumulating ETFs
Guide: ETF tax in Germany — Vorabpauschale and Teilfreistellung explained

The German rule exempting part of a fund's return before tax, by asset class: 30% for an equity fund holding at least 51% shares, 15% for a mixed one, and nothing for a bond fund. It compensates for tax already paid at company level and is worth more than it looks.

Calculators: Vorabpauschale calculator — German advance tax on accumulating ETFs
Guide: ETF tax in Germany — Vorabpauschale and Teilfreistellung explained

The German annual allowance against all investment income — €1,000 per person, €2,000 jointly assessed. It applies across dividends, realised gains and the advance charge together rather than per account, and you allocate it to each broker by filing an exemption order.

Calculators: Vorabpauschale calculator — German advance tax on accumulating ETFs
Guide: ETF tax in Germany — Vorabpauschale and Teilfreistellung explained

The Belgian transaction tax, charged on each side of a round trip at 1.32% for a registered accumulating fund and 0.12% otherwise, each side capped. Because it is a one-off rather than recurring, its annual cost depends entirely on how long you hold.

Calculators: TOB and Reynders calculator — the two Belgian ETF taxes
Guide: ETF tax in Belgium — TOB, Reynders and no capital gains tax

The Belgian tax on the bond portion of a fund's return, at 30%, applying strictly above a 10% bond holding. A pure equity tracker escapes it; a fund a percentage point over the line does not. It is the exception that shows how unusual Belgium's absence of equity capital gains tax is.

Calculators: TOB and Reynders calculator — the two Belgian ETF taxes
Guide: ETF tax in Belgium — TOB, Reynders and no capital gains tax

An annual Italian charge of 0.20% on the value of financial products held, with no threshold and no exemption for securities. Restated in the unit this site uses for fund costs, that is €20 per €10,000 per year — larger than many funds' entire ongoing charge.

Calculators: Imposta di Bollo calculator — the Italian tax on holding an ETF
Guide: ETF tax in Italy — stamp duty, capital gains and the accumulating advantage

The Italian wealth tax on foreign-held financial assets, at 0.20% — the same rate as the domestic stamp duty. Because the rates match, using a foreign broker changes who files rather than what you pay, and the difference is paperwork rather than euros.

Calculators: Imposta di Bollo calculator — the Italian tax on holding an ETF
Guide: ETF tax in Italy — stamp duty, capital gains and the accumulating advantage

An Italian classification for a fund recognised under European passporting rules, which qualifies its gains for the flat 26% rate rather than your marginal income rate. Every UCITS ETF listed on an Italian exchange qualifies, so it is a consideration for unusual holdings rather than ordinary ones.

Calculators: Imposta di Bollo calculator — the Italian tax on holding an ETF
Guide: ETF tax in Italy — stamp duty, capital gains and the accumulating advantage

The annual reduction in return caused by tax, expressed as a percentage of the holding so it can be compared against a fund's ongoing charge. It is the only honest way to put a Dutch deemed-return charge and an Italian stamp duty on the same axis as a TER.

Calculators: ETF cost calculator: every annual cost of holding one fund

The constant annual rate that would have produced the same ending balance — the geometric mean, not the average of the yearly returns. It is always lower than the arithmetic mean whenever returns vary, because a year of −50% followed by +50% averages zero and leaves you down a quarter.

Calculators: Portfolio backtest — what a mix actually returned, Rolling returns — how much the answer depends on when you started

The standard deviation of returns, quoted annually. Whether it needs annualising depends on the observation frequency: monthly figures scale by the square root of twelve, and annual figures are annualised already — multiplying them again overstates by roughly 3.46 times, which is a mistake this codebase has a test for.

Calculators: Monte Carlo simulation — the range of outcomes, not a single line, Portfolio backtest — what a mix actually returned

The peak-to-trough fall in value. It cannot be computed honestly from calendar-year data, because the trough usually happens inside a year: global equities ended 2020 up roughly sixteen percent while falling about a third from peak to trough that spring. Where only annual figures exist, the worst single year is the honest substitute.

Calculators: Portfolio backtest — what a mix actually returned, Loss tolerance — what each allocation lost in three real crashes

Investing a fixed amount at regular intervals. Because a fixed sum buys more units when prices are low, your average cost comes out below the average of the prices — real arithmetic, but not a way of beating the market. Contributing monthly from income is not a timing decision at all; deliberately drip-feeding a sum you already hold is.

Calculators: DCA simulator — what monthly investing does over time, Lump sum vs drip-feeding — which wins, and how often

Investing an entire amount at once. It wins more often than drip-feeding, because markets rise more often than they fall, and it loses in exactly the scenario people fear most. The gap is an insurance premium, and the argument for paying it is behavioural rather than mathematical.

Calculators: Lump sum vs drip-feeding — which wins, and how often

The percentage of a portfolio you can withdraw annually with an acceptable probability of it lasting. The familiar four percent figure comes from a specific study of a specific market over a specific period, and it is a starting point for thinking rather than a constant of nature.

Calculators: Safe withdrawal rate calculator — how long the portfolio lasts, FIRE calculator with real broker costs

The fact that the ORDER of returns matters once you are adding or withdrawing money, even though it does not matter at all for a lump sum left alone — multiplication commutes. Poor returns early in retirement do far more damage than the same returns later, because they shrink the base every subsequent withdrawal comes from.

Calculators: Sequence of returns risk — the same returns in a different order, Safe withdrawal rate calculator — how long the portfolio lasts

Running a plan over many randomly generated markets to produce a distribution of outcomes rather than one projection. The width of the resulting fan is the useful output; a single projected balance is the one number certain not to happen.

Calculators: Monte Carlo simulation — the range of outcomes, not a single line

Because compounding is right-skewed, the average outcome of a simulation sits above the middle one. An expected return entered into a projection is normally meant as the median — the typical path — and labelling a fan chart's centre line as a mean would put it in the wrong place.

Calculators: Monte Carlo simulation — the range of outcomes, not a single line

Why a daily-reset leveraged fund returns less than its multiple over any period longer than a day. Compounding a multiplied daily return is not the same operation as multiplying a compounded one, and the gap grows with variance rather than with direction — invisible in a calm market, severe in a choppy one.

Calculators: Leveraged ETF decay — why 2x does not double your return

Selling what has grown and buying what has not, to return to target weights. It is a risk-control measure rather than a return-enhancing one, and in Belgium and Italy it carries a direct tax cost that makes doing it less often the better default.

Calculators: Rebalancing calculator: what to buy, and what not to sell, Glide path calculator — equity allocation by age

How much two funds hold in common, measured as the sum of the smaller weight in each shared holding. Because issuers disclose only their largest positions, any figure computed from published holdings is a LOWER bound — the true overlap is higher, often much higher for two broad funds.

Calculators: ETF overlap checker: how much of two funds is the same company, Portfolio X-ray: what you actually own across your funds

Holding more of your own country's market than its share of global market capitalisation would imply. It is common, rarely deliberate, and worth measuring before defending: a European investor holding a global fund plus a European one may be far more concentrated than intended.

Calculators: Portfolio X-ray: what you actually own across your funds

Return after inflation, which is the only kind that buys anything. A nominal figure quoted over a long horizon flatters the outcome substantially, and in a country charging an annual tax on the holding the break-even return needed simply to stand still is inflation plus that charge.

Calculators: Purchasing power — what inflation and Box 3 do to cash, Portfolio backtest — what a mix actually returned

The observation that returns concentrate into short bursts, so being absent for the best months is expensive. The familiar version of the statistic is cherry-picked — the best months cluster against the worst ones, so nobody could miss one without missing the other — but the underlying point survives the criticism.

Calculators: Time in market — what missing the best months costs