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Which is better? Mutual funds vs Exchange Traded Funds (ETFs)?

Which are better investments Mutual funds vs Exchange Traded Funds (ETFs)?

1 Answer

ETFs are generally more simple than mutual funds, therefore they have less costs. For example mutual funds have larger management fees. Beside being more cost-effective, ETFs have a few more advantages compared to mutual funds:

- There are no minimum amounts. You can make small, frequent purchases of ETF shares if you want.
- Mutual funds are traded using the net asset value at the end of the day, while you can track changes of the price of an ETF all day long.
- If you buy and sell ETFs, you can enter special orders like limit orders and can use the shorting possibility.

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