INDEX FUNDS VS ETFS: WHICH TO CHOOSE?

INVESTMENT OPTIONS

Confused between index funds and Exchange Traded Funds? Let’s break it down!

HOW THEY WORK

Both follow an index, like the Nifty 50 or BSE Sensex, and aim to give similar returns.

INVESTMENT MODE

But they differ in how you buy and sell them.

TRADING OPTIONS

Index funds are bought at their day-end Net Asset Value, like regular mutual funds. ETFs trade on the stock market in real time, like stocks.

HOW TO INVEST

Index funds can be bought from mutual fund companies. ETFs need to be bought through a demat account.

WHICH ONE TO PICK?

If you prefer ease, an index fund may be suitable. If you like flexibility and real-time trading, ETFs may suit you.