Rabin Kumar Mahato
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My career is fueled by a profound passion for business, taxation, and auditing. Through rigorous academic training and comprehensive Articleship experience, I have cultivated a robust expertise in business analytics, auditing, and taxation. My practical involvement during Articleship has significantly enhanced my problem-solving capabilities and fostered innovative thinking. Additionally, I mainta
01/04/2025
Mutual funds and exchange-traded funds (ETFs) are popular investment vehicles designed to pool money from multiple investors to invest in a diversified portfolio of securities. However, they differ in structure, operation, and characteristics. Here's a detailed comparison and explanation:
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1. What Are Mutual Funds and ETFs?
Mutual Fund
• A mutual fund pools money from investors to invest in a diversified portfolio of assets such as stocks, bonds, or other securities.
• Managed by professional fund managers who actively (or passively) decide which assets to buy or sell based on the fund’s objective.
• Shares are bought and sold at the fund’s net asset value (NAV), calculated once a day after the market closes.
ETF (Exchange-Traded Fund)
• ETFs also pool money to invest in a portfolio of securities but trade on stock exchanges like individual stocks.
• Typically passively managed, aiming to replicate the performance of a specific index (e.g., S&P 500), although actively managed ETFs also exist.
• Prices fluctuate throughout the trading day, as they are bought and sold on exchanges
MutualFunds
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Mutual Fund & Its Types
Mutual Fund & Its Types
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13/02/2024
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