first time posting at Quantitative Finance.

I am trying to use the yfinance python library to load various ETF's data and compared the return.

I understand the adjusted closing price handles the effect of dividend and stock split. I wonder in the case of ETF or mutual fund, does the adjusted closed price takes care of the expense ratio? I tried to Google but got no definite answer.

If not, what is the best way to deal with the effect of expense ratio on return?

Many Thanks,


1 Answer 1


You don't have to back out the expense ratio manually. The expenses are deducted from the ETF NAV and baked into the price of the ETFs.

From the link below:

You won't find them on your account statement

The cost of investing is usually associated with trading commissions and account service fees—items you see as "debits" from your accounts.

But expense ratios are less obvious because they're not itemized on your account statements or confirmations. Instead, each fund's expenses are deducted from its total value on a regular basis. And those expenses cut directly into your investment returns.

Expense ratios: What they are & how they work

  • $\begingroup$ Thank you for your answer. With that being said, the adjusted closing price that we downloaded from Yahoo can be used directly without additional consideration of the expense ratio. $\endgroup$ Aug 27, 2019 at 23:19
  • $\begingroup$ @Porkbun-Wei Yes, that's correct. $\endgroup$
    – amdopt
    Aug 27, 2019 at 23:27

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