Exchange Traded Funds: A Different Kind of ET
Exchange Traded Funds, which are commonly referred to as ETFs, are another type of investment vehicle that allows you to buy shares that represent a pool of underlying securities. This makes ETFs similar to mutual funds, but there are also things that make them distinctly different. Let us examine how they are the same and how they are different.
How Are They the Same?
Structure
Both mutual funds and ETFs share the fundamental structure that any shares you own actually represent a proportional share in the underlying portfolio of securities they hold. Because of this, they both can provide diversification for your portfolio quickly, with a limited initial outlay of investment funds. ...
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