Calculty
Sign in

ETF Versus Mutual Fund Cost CalculatorFree online financial calculator — instant results, no sign-up

Compare one-year fund expenses, trading fees and a round-trip ETF spread.

Inputs

$
%
%
%
$
ETF estimated one-year cost
$45.00
Mutual fund estimated one-year cost$150.00
ETF cost advantage$105.00

Estimates only, based on the inputs and assumptions shown. This is not financial, investment, tax, or legal advice. Prices, rates and local rules may change; crypto scenarios do not predict returns. Confirm important decisions with a qualified professional.

Sign in to save results and favorites.

About the ETF Versus Mutual Fund Cost Calculator

The ETF Versus Mutual Fund Cost Calculator compares estimated one-year costs for the same investment amount in an ETF and a mutual fund. It combines the ETF’s annual expense ratio, round-trip spread and trading fees, then compares that total with the mutual fund’s annual expense-ratio cost. The difference shows the ETF’s estimated dollar cost advantage, not a difference in investment returns.

Investment ($)
The dollar amount used as the investment base for both funds, defaulting to $25,000.
ETF expense ratio (%)
The ETF’s annual operating expenses as a percentage of invested assets, defaulting to 0.1%.
Mutual fund expense ratio (%)
The mutual fund’s annual operating expenses as a percentage of invested assets, defaulting to 0.6%.
ETF round-trip spread (%)
The assumed total bid-ask spread cost of buying and selling the ETF, expressed as a percentage of the investment and defaulting to 0.08%.
ETF trading fees ($)
The total dollar trading fees for the modeled ETF purchase and sale combined, defaulting to $0.

Formula and method

C_ETF = I × (e / 100) + I × (s / 100) + F; C_MF = I × (m / 100); A = C_MF − C_ETF.
  • IInvestment amount in dollars.
  • eETF annual expense ratio entered as a percentage, such as 0.1 for 0.1%.
  • mMutual fund annual expense ratio entered as a percentage, such as 0.6 for 0.6%.
  • sETF round-trip spread entered as a percentage, such as 0.08 for 0.08%.
  • FTotal ETF trading fees in dollars.
  • C_ETFEstimated one-year ETF cost in dollars, including annual fund expenses, one round-trip spread and trading fees.
  • C_MFEstimated one-year mutual fund cost in dollars, based only on its expense ratio.
  • AETF cost advantage in dollars: mutual fund cost minus ETF cost.

Convert each percentage input to a decimal by dividing by 100. Multiply the investment by each fund’s expense-ratio decimal to estimate annual operating costs. For the ETF, also multiply the investment by the round-trip spread decimal and add that amount and the dollar trading fees. With the defaults, ETF cost is $25,000 × 0.001 + $25,000 × 0.0008 + $0 = $25.00 + $20.00 + $0.00 = $45.00. Mutual fund cost is $25,000 × 0.006 = $150.00. Subtracting ETF cost from mutual fund cost gives an ETF cost advantage of $105.00.

Worked example

These are the calculator's starting values and the results it actually produces for them.

Inputs

  • Investment25000 $
  • ETF expense ratio0.1 %
  • Mutual fund expense ratio0.6 %
  • ETF round-trip spread0.08 %
  • ETF trading fees0 $

Results

  • ETF estimated one-year cost$45.00
  • Mutual fund estimated one-year cost$150.00
  • ETF cost advantage$105.00

How to use the ETF Versus Mutual Fund Cost Calculator

  1. 1Enter the dollar amount you want to compare in Investment ($); the default is $25,000.
  2. 2Enter each fund’s annual expense ratio as a percentage, using 0.1 for the default ETF ratio and 0.6 for the default mutual fund ratio.
  3. 3Enter the ETF’s total round-trip spread percentage; the default is 0.08, and it is applied once rather than doubled.
  4. 4Enter the combined dollar trading fees for the ETF purchase and sale; the default is $0.
  5. 5Read the two estimated one-year cost rows and the ETF cost advantage row to see which option has lower modeled costs.

Reading your result

ETF estimated one-year cost includes annual ETF operating expenses plus the assumed round-trip spread and trading fees; the default result is $45.00. Mutual fund estimated one-year cost includes only annual expense-ratio costs; the default result is $150.00. ETF cost advantage equals mutual fund cost minus ETF cost, giving $105.00 with the defaults. A positive advantage means the ETF is cheaper under these assumptions, a negative advantage means the mutual fund is cheaper, and zero means equal modeled costs.

Limitations

This is a simplified one-year comparison using a constant investment balance and one ETF purchase-and-sale round trip. Actual expense-ratio charges accrue within fund assets, rather than typically appearing as a separate annual bill, and their dollar impact changes with asset values. The calculation does not model investment returns, contributions, withdrawals, compounding, taxes, tracking differences, market impact or ETF premiums and discounts to net asset value. Actual spreads can vary with liquidity and market conditions. Mutual fund sales loads, transaction fees, redemption fees and account-level charges are excluded because there are no inputs for them. Lower modeled costs alone do not establish that either fund is a suitable investment.

Common questions

Should I double the ETF round-trip spread input to account for buying and selling?+

No. This input already represents the total assumed spread cost across the purchase and sale. The calculator applies the default 0.08% once to $25,000, producing a $20.00 spread cost.

Why does the ETF cost $45.00 when ETF trading fees are $0?+

Zero trading fees do not eliminate fund expenses or bid-ask spread costs. At the defaults, the ETF has $25.00 in annual expense-ratio costs and $20.00 in round-trip spread costs, totaling $45.00.

Does the $105.00 ETF cost advantage mean the ETF will earn $105.00 more?+

No. It means the ETF’s modeled costs are $105.00 lower than the mutual fund’s modeled costs. The calculator does not estimate returns, and different holdings, tracking results or taxes can change investment outcomes.

Does this comparison include mutual fund sales loads or purchase fees?+

No. The mutual fund estimate uses only its expense ratio. If the mutual fund has sales loads, purchase fees or redemption fees, those must be considered separately before comparing total costs.

Does the calculator save my information?+

Calculations run in your browser. While signed in, inputs and results are automatically recorded in account history; saving a result creates a separate saved record.

You might also like

Interest Calculator

Growth of savings with compound interest and regular deposits.

Investment Calculator

Project an investment with monthly contributions.

Finance Calculator

Solve for future value from present value, rate, periods and payment.

Compound Interest Calculator

Compare compounding frequencies and see the effective rate.

Interest Rate Calculator

Find the rate on a loan from amount, payment and term.

Savings Calculator

How savings grow with deposits, interest and tax.

Results are estimates for informational purposes and are not financial, medical or legal advice.