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Lisa Nguyen

Transportation Researcher, UCLA
Updated: January 18, 2026
Investing

Expense Ratio

In This Article

Definition

Annual fee charged by investment funds as a percentage of assets, directly reducing returns. Lower is better.

Related Terms

Index Fund
Investment fund tracking a market index like S&P 500, providing broad diversification with low fees for long-term investing.
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FAQs

What's a good expense ratio?

Under 0.20% for index funds is excellent; over 1% is expensive.

Similar Terms

Index Fund

Investment fund tracking a market index like S&P 500, providing broad diversification with low fees for long-term investing.

Tax-Loss Harvesting

Selling investments at a loss to offset capital gains and reduce taxes, then reinvesting in similar assets.
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Last updated: January 18, 2026
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