How can I evaluate the performance of an ETF?

How can I evaluate the performance of an ETF?

To evaluate an ETF's performance, consider metrics like total return, expense ratio, and tracking error.

What is the total return, and why is it important?

Total return includes both price appreciation and dividends, providing a complete picture of an ETF's performance.

How does the expense ratio affect my investment?

A lower expense ratio means more of your investment returns go to you, while a higher ratio can eat into profits.

What is tracking error, and how should I interpret it?

Tracking error measures how closely an ETF follows its benchmark index. A lower tracking error indicates better performance alignment.