I am not sure how to wrap my head around how to calculate the real yield of an ETF using it's distribution yield and gross expense ratio.

What I really want to know is, given both ETF A and ETF B are the same price and perform the same, which is better?

  • ETF A: Yield 4.60%, Gross Expense Ratio 0.12%
  • ETF B: Yield 4.56%, Gross Expense Ratio 0.10%

Is it simple subtraction?

  • Yields are usually net of fees but what metric are you using to determine better? A has better yield after fees and before fees but is that all you want or does the capital appreciation of shares factor into things here at all?
    – JB King
    Jan 5 '16 at 18:25
  • I'm just trying to calculate yield after fees honestly. I guess to make it harder we can add a bunch of different factors, price, appreciation... etc.
    – bschaeffer
    Jan 5 '16 at 18:42
  • If you are taking the dividends from the ETF in cash then this can be useful. However if you re-investing them then a different calculation may be worth doing to see what the total return is on the funds. That's the reason why I asked the questions in the comment.
    – JB King
    Jan 5 '16 at 18:43
  • I see what you mean. Not as simple as I though. TBH I will be re-investing them.
    – bschaeffer
    Jan 5 '16 at 18:53

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