Mutual fund turnover ratio

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The mutual fund turnover ratio is a measure of how frequently assets within a mutual fund are bought and sold by the fund managers.[1] Fund turnover affects fund trading costs and can impact the realization of capital gains.[2]


The ratio is calculated by taking either the total amount of new securities purchased or the amount of securities sold - whichever is less - over a particular period, divided by the average net assets of the fund.

Example: The Vanguard Total International Index fund reports the following purchases and sales of stock during the 2017 fiscal year. Note that in-kind purchases and sales are not included in the turnover calculation. In this calculation, portfolio sales, being the lesser transaction, is used as the numerator.[3] [4]
Vanguard Total International Index Fund Turnover Ratio
2017 fiscal year
Average Net Assets Purchases Sales
Gross 268,472,804,000 49,143,665,000 9,445,858,000
In-kind 1,900,958,000 220,002,000
Net 47,242,707,000 9,225,856,000
Turnover 3%


  1. Portfolio Turnover, Investopedia
  2. Bogle, John C. (January–February 2014). "The Arithmetic of "All-In" Investment Expenses". CFA Institute: Financial Analysts Journal Vol. 70.CS1 maint: date format (link)
  3. 2017 annual report, Purchases and Sales, EDGAR
  4. 2017 NSAR report, Average Net Assets, EDGAR