How this calculation works
Direct and regular plans of the same fund generally share an investment portfolio, while their expenses differ. This comparison holds the gross return and every contribution constant, then applies the two user-entered expense ratios. It displays the resulting corpus gap and each plan’s drag relative to the same projection without expenses. It does not estimate the cost or suitability of switching an existing holding.
Worked example
This example uses illustrative inputs. Your current result is shown above.
For a ₹1,00,000 lump sum, no monthly SIP and a 0% gross return over one year, a 0% expense ratio leaves ₹1,00,000. A 1% annual ratio, accrued daily in this model, leaves about ₹99,004.97: a corpus difference of ₹995.03.
Assumptions and limits
- Both plans hold the same underlying portfolio and have the same gross return, initial investment, contribution amounts and contribution dates.
- Expenses are approximated as a constant fraction of assets deducted daily, using 365 equal days a year. Actual NAV calculations and changing expense ratios can differ.
- The expense ratio is applied once. Published NAV returns already include expenses and must not be used as a gross-return input.
- Corpus drag includes expenses and the growth those amounts no longer earn; it is not a statement of fees actually paid.
- Taxes, exit loads, distributor advice value and the consequences of switching an existing holding are not modelled. Returns are uncertain.
Questions people ask
Can I enter a fund’s historical published return?
Not as the gross return here. Historical NAV returns already reflect fund expenses. Deducting an expense ratio from those returns again would count that cost twice. Enter a hypothetical return before expenses instead.
Is the corpus difference the fee paid to a distributor?
No. It is the modelled difference between ending balances, including compounding. An expense ratio can include several scheme costs, and the corpus gap is not a distributor commission statement.
What if the two ratios are equal or the regular ratio is lower?
Equal ratios produce identical results. If the entered regular ratio is lower, the regular projection will be higher and the direct-minus-regular difference will be negative. The labels do not force a winner.