Question 1

How does the ETF simulator work?

Accepted Answer

The simulator projects your potential portfolio value based on monthly investments, expected return, investment duration, TER, and broker fees. It uses compound interest calculations to show year-by-year growth.

Question 2

What annual return should I use?

Accepted Answer

A common assumption is 7-8% for global equity ETFs (MSCI World historical average). For bonds, use 2-4%. These are nominal returns before inflation. Past performance does not guarantee future results.

Question 3

Does the simulator account for inflation?

Accepted Answer

The basic mode shows nominal returns. Enable Monte Carlo mode to add an inflation adjustment. With 2% inflation, a 7% nominal return becomes approximately 5% real return.

Question 4

What is the impact of TER on long-term returns?

Accepted Answer

Even small TER differences compound significantly. Over 30 years, a 0.20% TER vs 0.50% TER on a 200 EUR/month investment can mean 10,000+ EUR difference in final portfolio value.

Question 5

Should I include broker fees?

Accepted Answer

If your broker charges per transaction, enter the monthly fee equivalent. Many modern brokers (Trade Republic, BUX Zero) offer free ETF savings plans, making this cost zero.

Question 6

What is Monte Carlo simulation?

Accepted Answer

Monte Carlo runs thousands of simulations with random market returns to show the range of possible outcomes. Instead of one fixed projection, you see optimistic, median, and pessimistic scenarios with probability bands.

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Portfolio Simulator