Hi there! This may be a dumb question but I really can’t find the answer. How do I know that the share that I’m intrested in is a Mutual fund or Index Fund or just an normal ETF? Like what do I need to look for? I really struggle with understanding this. Thank you for your help so far guys!
ETF = Index fund. Mutual funds aren’t available on T212 platform. Nowadays I prefer ETFs over mutual funds (I own one from years ago elsewhere). ETFs are more flexible to trade.
An ETF is not an index fund. It is an exchange traded Fund. Can be active or passive. Can track an index or a strategic investment plan by the ETF issuer.
- Trades on an exchange like a normal stock.
- Can be bought throughout the trading day.
- Taxation and management fees usually lower.
- Bought through a broker.
- Disclose closings in real time (except for new type of ETFs which are ‘non-transparent’).
- Can only be bought/sold end of trading day at NAV.
- Bought through limited range of brokers or the fund manager itself.
- Sometimes have high minimum investment requirements.
- Disclose closings usually quarterly.
Basically, ETFs are more flexible while (passive) mutual funds can be less of a hassle (you can reach out to fund manager for support/service). I’d do some google searches for more info - there’s tons of material on this. Good luck!
Thank you! It is so much to learn about this stock market world that gets really confusing sometimes…