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Title: Why did I choose ETF not Mutual fund ...

What is ETF ?

ETF is called EXCHANGE TRADED FUND where first developed in 1990’s. It is the fund that

trade on exchanges, generally tracking a specific Index. We can get a bundle of assets.

For buying ETF’s we need DEMAT ACCOUNT. It indirectly means buying a stock. We find more

liquidity and during market hours we can buy and sell ETF’s. For example Nifty 50 ETF tracks the

composition of the Nifty50 Index. ETFs are popular with investors for a number of reasons, but

investors often find the lower operating expenses most appealing.

Most ETFs have low expenses compared to actively managed mutual funds.

ETF expenses are usually stated in terms of a fund’s OER. With ETF Keep in mind, the smaller

your investment and the more frequently you trade, the more impact these commissions will

have on your bottom line. The fund company doesn’t have to process your order; doesn’t have

to mail you the same documents; and doesn’t have to go into the market to process your order

What is Mutual Fund ?

MF collect money from a number of investors who share a common investment objective and

invests the same in equities, bonds, money market instruments and/or other securities. Equity

mutual funds can help you create wealth through capital appreciation, while debt mutual funds

can generate income for you. For Mutual funds we can process without Demat account.

The few things I found difficult was I need to find a fund manager. Here the liquidity is little low

and I cannot place multiple order in a single day. MF have lock in period. The big advantage is we

can go for SIP.

Comparatively both are almost same when it’s in Long-term.

I am being a short-term player I choose ETF.

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