Feature Release - Portfolio level TER%

We’ve added portfolio level TER% for DIY portfolios!!

  • This will show the weighted TER % of across all the funds you hold in your portfolio.

What’s TER?

TER stands for Total Expense Ratio and is how much in percentage (%) terms that the ETF charges for investment management and admin costs each year.

The TER is deducted directly from the ETF rather than being charged separately, and the value and performance of your investment is quoted after this deduction.

Your Portfolio TER is the weighted average of all the underlying ETFs expense ratios held within the portfolio.

Why is it important?

The size of the TER is important to investors as the costs are withdrawn from the fund, affecting investors’ returns . For example, if a fund generates a return of 7% for the year but has a TER of 4%, the 7% gain is greatly diminished to roughly 3%

This is taken from Investopedia -Total Expense Ratio (TER): Definition and How To Calculate.

Where can I find it?

It live for the Website (app update will be coming soon)

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Another great insight from InvestEngine :+1:t3:

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Good news, but the industry has been looking to retire the TER and moving to the OCF years ago. The difference being transaction charges of the underlying fund are included.

Are you sure you are adding the TER, so removing the transaction charge from the quoted OCF, or are you showing the OCF and calling it a TER?

Hi @RDougal

This is a interesting one. We now effectively show the OCF and label it TER%, we don’t remove any transaction costs.

A couple of reasons for this…but ultimately we wanted to show something customers would understand. We felt TER% was better understood & it got too complicated if you start talking about transaction costs within the fund.

Been keen to know your thoughts?
Is OCF (Ongoing Charges Figure) getting to be as widely understood as TER?

This is my understanding, albeit dated re brexit:

Point 4 of expectations quotes:

Platforms, advisers and other intermediaries should also use the OCF as the headline charges figure for UCITS funds.

The difficulty now is post brexit, UK funds (I think), no longer need to comply with UCITS, so does that mean they should revert to the old TER%

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