DIFFERENCE BETWEEN MUTUAL FUNDS AND ETF

Hye everyone

Hope you all are doing great .

So today i am here to tell you some basic differences about mutual funds and ETF .

BUT before that let us know what are these two terns .

1.MUTUAL FUNDS -

WE MUST HAVE HEARD OF MUTUAL FUNDS ARE SUBJECT TO MARKET RISK ,PLEASE READ THE OFFER DOCUMENT CAREFULLY BEFORE INVESTING ,

Whenever we listen to any of mutual fund adds .

Then why many of the office employees find it the most safe and most of us invest in it ??

Ever wonder .

Lets dive into it to know why .

A mutual fund is an open -end professionally managed investment fund that pools money from many investors to purchase securities.

These investors may be retail or institutional in nature .

When it comes to mutual fund you can earn in 3 ways from it -

1. Income earned from dividends on stocks and interest on bonds.

2. Through mutual payout.

3. An increase in the Price of securities called "Capital Gain"

Now

Coming to the other term that is ETF or exchange traded fund -

It is an investment fund traded on stock exchanges ,much like stocks .

Etf holds assets such as stocks ,commodities ,bonds ,and generally operate with an arbitrage .

Now what is the difference between ETF AND MUTUAL FUNDS ????

1. Etf is brought and sold by broker dealers whereas mutual funds are brought and sold through many channels.

2.ETF are listed on stock exchange unlike mutual funds .

3.Mutual funds are priced to the end of the trading days whereas ETF price continously determine during the trading day .

4.Mutual funds dividends may be automatically reinvested , but ETF dividends generally distributed to brokerage account.

So this is all about the basic difference between MUTUAL FUNDS AND ETF.

HOPE YOU FIND THIS ARTICLE INTERESTING  

THANKS