The effect of ETF fees on their performance and ROI

This study shows the ROI from Jan 2 2009 until today of all ETFs on the market ordered and grouped by management fees.

There are three group separations we considered: in groups of 100, in groups of 200 and in two groups of 350 each.

The lowest denominated groups have the lowest management fees. For example, these are the cheapest 40 ETFs:




















These are the most expensive 40 ETFs:




















These are the performance results:

In groups of 350:





The most expensive ETFs have a slightly better performance than the cheapest half, but the difference is insignificant

In groups of 200:







The 2nd and 3rd most expensive groups perform better than the cheapest group, however, the worst performers are actually the most expensive group.

In groups of 100:











Similarly, the 2nd to and 2rd to last most expensive groups perform better than the cheaper group, by as much as 14.51%. However, the most expensive group (actually only the top 67) performed very poorly, almost 40% worse than the best group.

Note that some of the 3X ETFs are not included as their exact fees could not be determined. Performance of 3X ETfs are terrible in the long term. With this caveat, this data suggests that there is value on higher management fees in ETFs, as long as thiose fees are kept below a certain threshold. In this case the threshold is around 0.75%.