Understanding ETF returns helps estimate your investment's future value. An ETF calculator simplifies this by quickly calculating potential returns based on your investment amount, term, and expected return, making planning easier.
Based on past performance of this fund
ENTER AMOUNT
Select Duration
Expected Rate of Return
Total Value of investment after 3 years will be
Invested Amount
₹3,60,000
Est. Returns
₹75,076
An Exchange-Traded Fund (ETF) is a type of investment that combines features of both mutual funds and individual stocks. It is a pooled investment security that can be bought and sold on a stock exchange, just like a regular stock. ETFs are typically designed to track the performance of a specific index, commodity, sector, or group of assets, making them an efficient way for investors to gain exposure to diverse markets or investment strategies.
Unlike actively-managed mutual funds, ETFs are passive funds. They replicate the returns of the index or asset they track, meaning their performance moves in line with the market. This passive management structure allows ETFs to have lower fees, significantly lower than the 1% or more that many actively-managed mutual funds charge.
An ETF calculator is a handy tool that helps investors estimate the potential value of their ETF investments over time. By considering key factors like the initial investment amount, duration, and expected return rate, it provides a clear picture of your investment's future value. This tool not only calculates the total value of your investments but also offers an estimate of the returns for the chosen period, making it easier to plan and track your financial goals effectively.
The initial investment represents the starting capital you plan to allocate to an ETF. The expected return reflects the annual percentage gain you anticipate from the investment, while the time period indicates how long you intend to hold the ETF.
Understanding how an ETF calculator works is key to making smart investment decisions. This online tool is simple to use, providing quick estimates of your investment's future value. It factors in your initial investment amount, expected rate of return, and investment duration.
By entering these details, the calculator displays the estimated total value and returns based on the past performance of the selected ETF. This helps investors gain a clear understanding of potential outcomes, making it easier to plan and align investments with financial goals. It's a practical tool for efficient and informed investment planning.
Using Angel One’s ETF calculator is simple and hassle-free. Just open the ETF Calculator online on Angel One and follow these steps:
That’s all it takes. The Angel One ETF calculator will instantly provide the total value of your investment, along with a detailed breakdown of the invested amount and the estimated returns at the end of the selected duration. This tool is an efficient way to plan and track your ETF investments effortlessly.
ETF returns are influenced by both the market price of the ETF and its Net Asset Value (NAV). The market price is determined by supply and demand, while the NAV represents the per-share value of the underlying assets. Occasionally, an ETF's market price may deviate slightly from its NAV. In such cases, institutional investors engage in arbitrage—buying or selling ETF shares—to align the market price with the NAV. This ensures that differences between the two remain minimal.
To understand returns, consider a hypothetical example. Suppose you purchase 50 shares of an ETF at ₹100 each, spending ₹5,000. If the price increases to ₹115 after 3 months, your investment is now worth ₹5,750, yielding a profit of ₹750 and a holding period return of 15%.
ETF NAV is calculated daily using the formula:
NAV = (Assets - Liabilities) ÷ ETF Shares Outstanding
This formula accounts for the closing prices of the ETF's underlying assets (weighted by their holdings) and subtracts any liabilities. While the NAV reflects the ETF's value, actual returns depend on the market price during transactions. Any deviations between NAV and market price are typically small, thanks to the arbitrage mechanism, ensuring consistent performance tracking.
Effective financial planning: An ETF calculator serves as a crucial tool for investors looking to plan their finances efficiently. By offering precise calculations, it helps set clear investment goals, whether it’s saving for retirement, funding higher education, or achieving other financial milestones.
Accurate future value estimates: The calculator leverages advanced algorithms to estimate the future value of your ETF investments. By factoring in variables such as the initial investment, expected returns, and duration, it offers accurate predictions, enabling informed decision-making and long-term financial planning.
Simplifies complex calculations: Calculating the returns on ETF investments manually can be both tedious and prone to errors. An ETF calculator eliminates this hassle by providing quick and reliable results, allowing you to focus on refining your investment strategy.
Time-efficient tool: By automating calculations, the ETF calculator saves time and effort. Instead of manually working through complex formulas, you get instant insights, which is particularly useful for busy investors managing multiple financial plans.
Scenario analysis and comparison: One of the key advantages of an ETF calculator is the ability to test various scenarios. You can modify parameters like the investment amount, expected rate of return, and holding period to evaluate different strategies. This comparative analysis empowers you to choose the most effective investment path tailored to your financial goals.
The initial capital invested in an ETF forms the foundation for calculating returns. A larger investment amount generally yields higher total returns in absolute terms, as returns are proportional to the invested principal. For example, a 10% annual return on ₹1,00,000 is ₹10,000, while the same percentage on ₹50,000 is ₹5,000.
The expected rate of return reflects the projected annual growth of the ETF, influenced by the performance of its underlying securities. ETFs tracking strong indices or sectors with positive growth trends tend to offer higher potential returns. However, it’s important to consider market risks and fluctuations that can affect these projections.
The time period for which an investment is held determines the extent of compounding, a key factor in wealth generation. Longer durations enable the reinvestment of earnings, leading to exponential growth in returns. For instance, an ETF held for 10 years may provide significantly higher cumulative returns compared to one held for just 3 years.
Expense ratios are the management fees charged by ETF providers. They directly reduce the returns investors receive. For example, a high expense ratio of 1% can eat into your returns, whereas a low ratio of 0.1% leaves more for the investor. Opting for ETFs with lower expense ratios can enhance overall profitability.
ETFs derive their value from the performance of the underlying securities. Factors such as economic policies, global events, or industry-specific changes can positively or negatively affect the ETF’s returns. Diversified ETFs tend to be less volatile compared to sector-specific ones.
From FY 2021 onwards, dividend income from ETFs is added to the investor’s total income and taxed according to their income tax slab rate. Earlier, a 15% Dividend Distribution Tax (DDT) was applicable, which has since been abolished.
For equity ETFs, short-term capital gains (holding period of up to one year) are taxed at 15%. Long-term capital gains (holding period of more than one year) above ₹1 lakh are taxed at 10% without indexation benefits.
Commodity and International ETFs qualify for long-term capital gains tax at 12.5% after a holding period of 12 months if listed. However, investments through mutual funds or physical routes require a 24-month holding period for LTCG benefits.
ETF Name | Current Price (₹) | HI_52_WK (₹) | LO_52_WK (₹) |
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