The eternal debate, quantified. Compare a diversified ETF strategy against stock picking, factoring in fees, volatility, and the probability of beating the market.
The debate between passive ETF investing and active stock picking has been studied extensively. Research from SPIVA (S&P Indices Versus Active) consistently shows that over 80% of actively managed funds underperform the S&P 500 over a 15-year period. Our free ETF vs Stock calculator simulates thousands of possible outcomes using Monte Carlo analysis, helping you understand the range of potential results for each strategy.
ETFs (Exchange Traded Funds) offer instant diversification, lower fees, and more predictable returns. The average ETF expense ratio is just 0.07%, while actively trading individual stocks often incurs higher costs through bid-ask spreads, commissions, and taxes from frequent trading. Over 20+ years, even small fee differences compound into significant dollar amounts that can make or break your retirement goals.
Stock picking can outperform the market, but the odds are against you. This calculator lets you adjust expected returns, volatility, and fees for both strategies to see how different assumptions affect the outcome. The Monte Carlo simulation runs hundreds or thousands of scenarios, showing you the median result, best case, and worst case for each approach. Use it to make an informed decision about your investment strategy.
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