Strategy comparator
Active vs. index management
At the same gross return, how much does paying a higher fee for active management cost you long-term.
0 €
300 €
8%
0.2%
1.5%
20
Index fund: Final value
€173,499
Active management: Final value
€147,923
At the same gross return, the index fund ends up with €25,575 more at 20 years, purely because of its lower fee.
We don't assume any extra skill (positive or negative) for active management: both branches start from the same gross return, and the only difference is the TER. In practice, very few actively managed funds beat their benchmark index consistently once fees are deducted.