Basics

What is TER?

TER (total expense ratio) is a fund's total yearly cost, measured as a percentage of what you have invested. A TER of 0.2% means 2 euro a year per 1,000. The amount is deducted automatically inside the fund's price — you never get a bill.

Why a small number matters a lot

0.2% and 1.5% both sound like nothing. But run 100,000 for 25 years at 7% return before costs:

With TER 0.2% you end up at about 517,000.
With TER 1.5% you end up at about 381,000.

The difference — around 136,000 — was not lost in the market. It went to the fund. That is why costs are the one number you can do something about with certainty.

What is cheap and what is expensive

0.05–0.3%: typical for broad index funds and ETFs. Cheap.
0.3–0.7%: narrower funds — one region, one sector, one theme.
Above 1%: typically actively managed funds. Here you should be able to say what you get for the money.

What TER does not cover

TER is the fund's own cost. On top comes what you pay to trade: commission at your bank or broker, spread, and possibly currency exchange. Buy rarely and hold long, and these matter less. Trade often, and they matter more than TER.

Kiggo says: Returns are a hope. Costs are a promise. Start with the one you can control.

The typical beginner's mistake

Comparing funds on returns and forgetting TER. Two funds tracking the same index give the same return before costs — the cheaper one wins every single year, without exception.

How you see it in Kiggo

On every ETF in Kiggo, TER sits in the ETF checklist alongside accumulating/distributing, size and replication. Tap the line and Kiggo explains whether the number is low or high for that kind of fund. In Kiggo's curated ETF list under "Market", the approximate TER is shown next to each fund so you can compare right away.

Frequently asked questions

Do I pay TER separately?

No. It is deducted continuously inside the fund's price, a tiny bit each day. You never see it as a bill — which is exactly why it is so easy to forget.

Is OCF the same as TER?

Nearly. OCF (ongoing charges figure) is the UK/EU term and is defined slightly differently, but for a beginner they measure the same thing: what the fund takes each year. Always compare like with like.

Kiggo explains — Kiggo does not advise. We never tell you what to buy or sell, and key figures can only be compared between companies in the same industry. The decision is yours. Last updated 2026-09-07.

Written by Claus Frisch, founder of Kiggo. Not an adviser, not a bank — Kiggo explains, you decide.