TER (Total Expense Ratio)

What is a TER?

TER stands for Total Expense Ratio. It’s a measure of a fund’s yearly running costs, shown as a percentage. A TER of 0.20% means the fund provider takes £2 a year for every £1,000 invested.

What is the difference between TER and OCF?

The OCF (Ongoing Charges Figure) replaced the TER in the UK. The OCF includes a few more costs, so it’s a slightly more complete picture. In practice, the numbers are usually very similar.

If you see a TER instead of an OCF, treat it the same way. It’s the fund’s annual fee.

Key points about TER

• The fund’s yearly fee, shown as a percentage
• Now replaced by OCF, which includes slightly more costs
• Treat them the same. Both tell you what the fund provider charges