Etf vs index fund canada reddit. An index fund is simply a fund that follows an index.

Etf vs index fund canada reddit. 2023 was particularly advantageous towards index investors (likely due to active portfolios underweighting the magnificent 7?) What is an ETF? An ETF is a tradeable fund, containing many investments, generally organized around a strategy, theme, or exposure. trueBasis last 5 yr market returns, and personal preference I have decided to move to passive investing. If you look at the numbers, covered call etf's will generally under perform the underlining stocks that are held. Using VGRO as an example, it's a single ETF that holds 7 underlying ETFs in fixed proportions: 4 Equity ETFs (Canada, USA, Interntional Developed, Emerging Markets) and 3 Bond ETFs, (Canada, USA, International), in an 80% equity, 20% bond ratio. Then etfs and mutual funds are specific constructions of index funds. While Exchange Traded Funds (ETFs) and Mutual Funds can be similar in some ways, they have distinct differences including their trading characteristics, pricing factors, and tax implications. The underlying holdings of S&P 500 ETFs are all the same. Jul 8, 2024 · Canadian equity indices are the S&P/TSX 60 Index and the S&P/TSX Composite Index. There is a valid use case for buying these Mutual Funds, despite being more costly. Sep 13, 2023 · When considering ETFs vs index funds for your portfolio, it’s important to have a strong understanding of each. As part of the, I can get Fidelity Index funds and iShares ETFs commission free, as well as purchase any other fund for the $4. Anywho it’s usually possible to buy them with automatic purchases while for ETFs you have to remember to do it on your own. 08%. When the market is doing poorly, the fundametals people are usually right. All of them should have good tracking. Does anyone have any preferred reading or viewing that can clearly and comprehensively compare and contrast these two products? I’m also happy to hear any paraphrased explanations you folks would care to share instead. A common investment strategy is VOO (an American ETF tracking the S&P 500) within the RRSP and VFV (same ETF, only in Canadian) within the TFSA or taxable accounts. These robo advisors use similar low cost ETF in pre-determined portfolios based on your risk tolerance. They are low cost funds. Passive index mutual funds are very nearly as tax efficient as ETFs, and in vanguard's case, they're exactly as tax efficient as the ETF share class of the fund. The point of Index Funds/ETFs isn't that they are "managed by actual financial managers", it's that they aren't managed at all. In what instances would an individual invest into an index fund instead of ETFs My other confusion is why are there so many articles around the internet that can’t explain between this two funds, am i missing something? Or is there no difference between the Mutual funds will have a higher expense fee than an ETF. 1%). But to put the issue into concrete, granular terms for you, let’s looks at SWTSX: In two of the last five years (2021 and 2019) STWSX paid out taxable capital gains distributions. Mutual funds also let you invest say $100 a month into and buy $100 worth of the mutual fund, if share price is $80 you bought 1. I noticed that their annualized returns over the past decade have been quite impressive, at approximately 28. Learn about investing, saving, retirement and more. I think the sector specific etf’s are generally more for traders than for investors, but it can be a easy way to “safely” dip toes into a sector that you are interested in. His work has since inspired others to get the most out of their long-term investments. You are raising your risk going all in, in a single country, different currency, without actually raising your expected returns, which is a bad trade off. I’m a 24 year old investor and would greatly appreciate some suggestions! Jun 18, 2024 · ETFs and Index Funds are investment assets with different risks and rewards. No "experience" required. You access mutual funds by subscribing through a bank, a broker or directly with the fund company. Something you are saying doesn't ring true. Mutual funds you can buy in any dollar amount but are less liquid, thus there is an upside protection from selling due to emotion. TTP is my favourite because it is a broad market Canadian fund. Is this a good choice or should I be investing in a unhedged fund that tracks NASDAQ 100? What's the difference? How significant is the difference between the return of hedged vs. The most common would be the S&P 500 Index, Nasdaq, or Russell 2000, but there are hundreds. The relevant question isn't "index fund" vs. But personally, I prefer using the Fund Facts document—it’s a more condensed and easier-to-read version of the key information. Discussion is geared towards investment opportunities that Canadians have access to, including questions regarding individual companies, ETFs, tax implications, index investing, and more! We would like to show you a description here but the site won’t allow us. Broad market index funds are a mix of growth and value across the entire spectrum of capitalization levels from small to large. But the more average DIY ETF investor who sits on contributions, chases yesterday The only difference with the ETFs vs e-series (aside from lower MER) is that they are traded on the live exchange each day. Oct 9, 2024 · Etf vs index funds by Milderwom » Fri Oct 11, 2024 6:08 pm Hi! I’m new here. The answer depends on 1) if you're comfortable buying and selling on the stock market (and being smart about currency conversion if you're buying USD ETFs) vs setting and forgetting a monthly deposit. They just passively track an index or basket of stocks. ETF. an index ETF, it's true that in many cases the ETF is more tax-efficient than the equivalent mutual fund because the ETF has lower capital gain distributions. The problem with covered call etf's is that they say that there is downside protection because of the premiums one gets but that doesn't mean the etf price won't drop, it's just slightly offset by the premiums. I'm new to investing and was wondering if I should focus on Etf's like VOO and QQQ over mutual funds. Most of my investments are in the US, but I have some here in Canada. The resources Felix mentioned and/ or Reboot Your Portfolio (Bortolotti,20021) explain how can build a low cost, globally diversified, index tracking portfolio that is suitable for Canadian investors. If you look at IRBO's holdings they are more equal % wise and it has 137 holdings compared to BOTZ which is only 47 holdings and NVIDIA is 15%, ISRG is 10%, DT & PATH 5% each -- so that is 35% I have an emergency fund/no debt/regular pension contributions. 25 shares. So asking what is better an etf or index fund is like asking what is better, beef or meat. An index fund is a fund, mutual or ETF, that follows an index. Here's Vanguard's own site: And because of the In case you're curious, I've summarized a few of the most popular portfolio investments in Canada below. VGRO or XGRO, for example, use Vanguard and iShares ETFs to maintain an 80/20 portfolio. HOWEVER, you can buy American ETFs within your RRSP and not deal with this - it would only be when you withdraw in retirement that you'd want to use Norbert's Gambit for these funds. Unhedged funds like VFV have drastically outperformed CAD hedged funds. "ETF" vs. I personally have a mix of canadian and american etfs, but I wanted to know what some of you guys do. An S&P 500 index fund, no matter what kind, holds those 500 companies in the proportion that the S&P 500 index specifies. These can be either ETF An ETF can track an index, theme, or whatever the prospectus and management decide Index Fund - an ETF or mutual fund that tracks a specific index. If I went with the equivalent mutual fund, I would end up needing to pay every time I buy. My specific question: What are the benefits of investing in dividend stocks rather than dumping your money into SPY, or QQQ (SPY & NASDAQ index fund equivalent)? Both of these indexes are quite diversified across all the companies they are comprised of. Choosing a CAD hedged ETF basically means you're betting that the Canadian dollar will gain value vs the US dollar. Active managers want your money - our advice: keep it! How? Investing in broad-market low-cost New investor here. Thanks all! The expense incurred in acquiring the ETF is a one time cost whilst the expense incurred in purchasing and holding the UTI Nifty50 index fund is a recurring annual expense. . ETF can be index funds. They've also outperformed the US market since 1999, source: TD Canadian Index Fund returned 6. ETFs are just funds that you can buy on exchanges like stocks (ETF=exchange traded fund). Every mutual fund and ETF can be categorized as either passively managed or actively managed funds. Save a bit on ER for sacrificing any portability if you change brokers I've been diving into the world of ETFs and came across semiconductor ETFs, specifically SMH and SOXX. That approach could be tracking a sector of the stock market, like technology or energy; investing in a specific type of bond, like high-yield or municipal; or tracking a market index, like the S&P 500 ®1 or Nasdaq composite index. I purchased XQQ which is BlackRock Canada iShares NASDAQ 100 index ETF CAD-Hedged. Here are some links which should answer your questions. Mutual Funds not ETFs vs Index Funds. An index funds is any fund that just passively follows an index. Both ETF's and mutual funds can be index funds or actively managed. Top etfs to invest in Canada I am looking to dca some etfs with my tfsa holdings, I am a big fan of the vanguard etfs but there are so many I dont know which one is the best to go with. Or you can keep using the e-series. So you'll have a less consistent outcome (could be higher, could be lower) than the equivalent asset allocation ETF, less fees. They then use the premium they’re paid for writing these and pay it back out to the holders of the ETF. Edit: The big difference is between mutual funds and ETFs, and that's mostly how they trade. Such funds are usually tax efficient, and usually similarly tax efficient compared to their ETF. Opinions on what is Canada best dividend etf, for stock appreciation, dividend yield and overall safest There are two main types of sets you can get: ETFs (Exchange-Traded Funds) and Mutual Funds. Whatever happens to that basket of stock happens to the ETF. ETF stands for Exchange Traded Funds. The Vanguard Admiral class mutual funds have the same tax-efficiency as their ETFs, so it's not always true. They can save you a lot of money and boost your returns over time. Apart from these you have "classic" mutual funds. 2 Unlike mutual funds, ETFs On the contrary, exchange-traded funds, or ETFs, provide benefits over mutual funds, such as cheaper fees, intraday trading, and transparency in holdings. In Europe there is little offer of index mutual funds, so you can basically translate index fund with ETF. I understand that Index funds are funds that can be only be bought at the end of the trading day whereas ETFs are traded on an exchange. If you mean an index mutual fund vs. Jack founded Vanguard and pioneered indexed mutual funds. If you ever want to leave vanguard, they support a one way conversion from mutual fund to ETF and the moving account will be easy. #5 – iShares Canadian Select Dividend Index ETF (XDV) When researching ETFs, you can simply search the ETF name and go straight to the company’s website. Any information you could share would be highly appreciated! Index fund is the catch-all term. Why would anyone buy admiral shares instead of the corresponding ETFs? Admiral shares tend to be a tiny bit more expensive than the corresponding etf; for example, VTIAX is 0. Investing in index funds vs life insurance Been looking into life insurance policies and from what my basic understanding is that you pay a monthly fee and they invest that money to grow the fund. Generally, they offer significantly lower fees than mutual funds. It's a mixup of terminology which is very common in personal finance subreddits. Discussion is geared towards investment opportunities that Canadians have access to, including questions regarding individual companies, ETFs, tax implications, index investing, and more! For those who are not comfortable with doing the buying and selling of ETFs yourself, there is an option of a robo advisor. For instance, a notable difference is that Mutual Funds trade only once per day while ETFs trade throughout the day, similar to an ordinary stock. I use ETFs in my Roth IRA simply because there are no transaction fees. We will cover the 6 best TSX index ETFs below and outline some of their key features. The latest personal finance articles and guides. I'd like to have your input on ETFs vs mutual funds, I know that everybody here seems to be all in ETFs, but at some point, are there any advantages to mutual funds when you have over a million in your portfolio? Investors who can invest as soon as they have money to invest and robotically follow their predetermined investment plan, no matter how their individual funds are performing and what the media is telling them, can annually save about $50 per $10,000 invested by using a DIY ETF portfolio instead of a robo-advisor. 77% since inception Edit: I would not invest in stocks if I needed the money within 2-3 years, but that's not specific to Canadian index funds. Through my work 401k, I can now move out of the company sponsored funds with high expense ratios into a brokerage account still under the 401k. There are many "one-fund" ETFs available that are composed of other ETFs to bring you to an overall asset allocation. ETFs are traded on the stock market in real-time; index funds are often bought directly from a fund manager. S. These mutual funds both have about 80% equity, so they'll have expected returns similar to VGRO (expected real return of 3. Although it may limit potential outperformance, its passive management approach tracks specific indices. Automating savings is very good. The tax advantage issue would be the primary reason to choose an ETF over a mutual fund and it’s not a huge deal for most low cost index mutual funds as they’re already quite tax efficient. Discover the benefits, types, and how to get started with low-cost investing. I read somewhere along my research that it is not as tax efficient to have Index Funds/Mutual funds in a non-retirement account and it's better to have an equivalent ETF instead. I'm not a fan of asset allocation ETFS like ZEQT, VEQT, XEQT etc. If you buy small amounts regularly (under $1000) and are on a fee-based platform like RBC direct investing, then it’s cheaper to buy the MF Vs the ETF. XEQT/VEQT, XGRO/VGRO, XBAL/VBAL An Index fund is simply a fund that tries to track a market index, like an S&P 500 fund for instance. There are lots of different policies to pick from with varying premiums. Low cost, low maintenance, automatically balanced. Better in what way? Vanguard Mutual Funds that have ETF share classes are exactly as tax efficient as their ETFs. I have been buying ETFs for the past 6 months… about one or two (VOO and VB but will rethink based on advice on VB) per week or every other week. Still cheaper then bank mutual funds by at least 50%! The difference in index vs actively managed funds, and the difference in mutual funds and ETFs Asking the difference between index fund and ETF is equivalent to asking the difference between an SUV and a Toyota. They are very low cost, diversified, and passively follow specific segments of the market OR the entire market. 87% and 25. e-series is a mutual fund and they do the buying and selling at the end of the business day. The differences are very minor, negligible even in your IRA or other tax sheltered account The expected returns between the fidelity zero and vanguard etfs is very small. Confusing, I guess. I'm starting to look at my investments a bit more and I'm keen to learn more about investing. ETFs are usually more tax efficient so they are the way to go in a taxable account for that reason. "Index" refers to how the fund decides what to invest. So the argument is irrelevant. Either way, there are fees that you will have to pay and your liquidity might Some of the other ETF's have huuuge chunks of holdings in NVDIA and such, whereas IRBO seems more balanced IMO with an index that follows the sector. Most people on this forum favor broad market index funds, particularly Vanguard. Mutual funds distribute earnings at the end of the year leading to capital gains tax. Edit: I just realized I’m not sure if mutual funds are fractional. ETFs don’t. This question pertains only to a taxable brokerage account. It's ETFs vs. Learn how to invest in Index Funds Canada with our beginner's guide. In an ETF, those Jul 23, 2025 · ETFs and index funds can follow the same strategy, but they’re not always the same thing. How ETFs are different than Mutual Funds ETFs vs Index Funds Livemint's graphic representation on breakdown of charges levied on ETF However ETFs don’t have automatic purchase as they don’t have fractional shares. Index funds are awesome for regular investing accounts. I’ve been investing for a little while now, but mostly heavy in tech and index funds. Here's what i've found about the difference between Index Funds and ETF''s: "Like ETFs, index funds aim to track an index as accurately and cost-effectively as possible. Mutual fund are priced and traded once a day after the market closes, but lets you buy exact dollar amounts and fractional A discussion forum for advice on personal finance in EU countries. I’m wondering if it makes more sense to put it in my index fund ETF or renew a GIC in my TFSA at 5. 38%, respectively. In a retirement account, go with Mutual Funds because 1) you can buy in fractional shares (ie you can invest an exact $ amount). You should probably look at index funds. However, here in the UK, I do not understand the shifting towards ETFs, having Index Funds so accessible. Stocks/ETFs vs Index Funds/Mutual funds and being more tax efficient? I am still new to the stocks world and setting up my brokerage account. Additionally, look into robo-advisors as they can provide automated portfolio management tailored to your goals. "mutual fund" refers to how investors purchase or redeem the fund. Jun 3, 2025 · Confused about ETFs, index funds, and mutual funds? Learn the key differences, pros and cons, and which investment is right for your financial goals. 75% MER, that'll drop Feb 2, 2025 · Learn more about the top Canadian index funds and how to determine if they're a safe investment for you. These funds can be managed to follow a certain index (passively managed) or allows flexibility from the fund manager to try and beat the market (actively managed). Active funds typically just have larger dispersion with similar expected returns, less fees. The all-in-one ETFs like VEQT implement global diversification automatically for you. trueCould someone give me an example of a popular TSX index fund vs a popular ETF? And how to start my own research into how to tell the difference on my own when looking into an asset I'm interested in? Thank you! Bogleheads are passive investors who follow Jack Bogle's simple but powerful message to diversify with low-cost index funds and let compounding grow wealth. Can someone explain what the heck is happening in our market right now particularly in regards to investing in stocks vs GICs? I have been investing regularly in the VGRO index fund (80/20 stock/bond balance) and wondering if I should continue to stick to this plan or put some in a GIC given the higher rates? Are stocks expected to take a down turn given the control of inflation and such? 33 We would like to show you a description here but the site won’t allow us. ETFs can either be actively managed or they can be index funds, same with Mutual Funds. Clarifying difference between index fund and mutual fund Please forgive me if this is a dumb question. An index can also be virtually anything because fund companies can define them at will. Sure the US did great recently. Bogleheads) submitted 5 hours ago by HereToReadEms First time Reddit poster, and very grateful for the collective and generous wisdom that is this Boglehead community. Seems like a lost opportunity for them to not have one since there aren't that many and the common investor will usually only invests in . Source? Index-based mutual funds are much more tax-efficient than actively managed mutual funds, but they still have to do adjustments to rebalance due to market cap weighting and the like. Discussion is geared towards investment opportunities that Canadians have access to, including questions regarding individual companies, ETFs, tax implications, index investing, and more! 139 votes, 76 comments. With the increase of 1. Why do people consider mutual funds when index funds have less MER and can have similar diversification and/or higher returns? 38 votes, 100 comments. Investing in an ETF or index fund versus real estate rentals? I've been playing around with broad mathematical projections on the ideas in the title. not so much for ETFs. I'm currently a bit all over the place with my Roth investments, having invested in some Etf's and a few individual stocks like MSFT and AMD. Interested to hear your takes, as they will guide me with my own research. TD ETFs are great passive index funds. ETF as a Legitimization Step-The introduction of a Bitcoin ETF can be seen as a step towards the legitimization and mainstream acceptance of Bitcoin, making it more accessible to a broader investor base. ETFs are like a Lego set you can play with and trade with your friends all day long. May 28, 2025 · This article will help you understand the differences between ETFs and index funds and determine which one you should be investing in. Exchange-traded funds hold baskets of stocks that represent stock indexes. Most people want low-cost index funds. Active managers want your money - our advice: keep it! How? Investing in broad-market low-cost For those of you who don’t know what covered-call option ETFs are, they are normal ETFs that track an index but the fund managers write call options on the underlying holdings. ETF is a type of fund (mutual fund being another type), they can be actively managed or track an index. 2) You can set up automatic investing for mutual funds. For most beginners a We would like to show you a description here but the site won’t allow us. They change prices throughout the day, just like how some toys become more popular and others less so as the day goes on. But what's the meaning of trading intraday (ETFs) vs at market closing (index fund)? Is there any benefit of one over another? Do we have index funds in Canada, or just ETF’s that try to mirror the S&P/TSX, and total market? I understand that XIU is one, but it doesn’t seem like we have many to choose from. Other funds have other kinds of investing strategies that aren't tied to a particular index - target date funds, for example, are a mix of stocks & bonds that changes over time. That hasn't really happened in a long time, and CAD hedged ETFs have suffered as a result. Join our community, read the Wiki & FAQ, and get on top of your finances! I want to sell off my VGRO position and be either in a 100% equity ETF like VEQT or an index fund, but I'm not sure what general factors I should consider when deciding between the two. May 12, 2025 · Back for the 13th edition, here are the top exchange-traded funds among Canadian, U. VEQT is 100% equities. Have gone through this forum as well as numerous reports mentioning Index funds are better primarily due to liquidity available + lower transaction charges so decided to test it out. I have a decent understanding of mutual fund vs etf structure; I also understand why ETFs are cheaper for Vanguard to implement. An ETF is a type of fund bought through the stock exchange (=exchange traded fund). r/ETFs does not endorse any recommendation or opinion made by any member, nor do any users or moderators of r/ETFs advocate the purchase or sale of any security or investment. Discussion is geared towards investment opportunities that Canadians have access to, including questions regarding individual companies, ETFs, tax implications, index investing, and more! The all in one funds are amazing for Canadians. This might all be semantics, but are mutual funds a larger group with index funds being within mutual funds (ie all index funds are mutual funds but not all mutual funds or index funds)? Or are they completely separate entities? A S&P 500 ETF is a S&P 500 index fund. Fund Overlap See which holdings any two equity ETFs have in common, along with top differences in exposure. It’s US-only. An index fund can be in the structure of am ETF, meaning it is traded on an exchange like a stock, or a mutual fund, meaning that it has a mutual fund structure. I've always used Index Funds and never ETFs. We would like to show you a description here but the site won’t allow us. Index funds can be ETFs. 49% since inception TD U. They do this for a small fee, on top of the ETF MER. trueIn a tax-advantaged account like a Roth IRA, mutual funds with a lower expense ratio than a comparable ETF (FSKAX vs VTI) are the way to go. Hi all, I’m trying to get a better sense of the differences / crossover between an ETF and an Index Fund. Most brokerages don’t offer fractional shares on ETFs, so you’ll have to buy whole shares and may have a small cash drag. Vanguard FTSE Canada All Cap Index ETF seeks to track the performance of a broad Canadian equity index that measures the investment return of large-, mid- and small-capitalization, publicly traded securities in the Canadian market. Fidelity already has a mutual fund that tracks the S&P 500 with FXAIX but is there a reason why they haven't released an ETF yet? A lot of new investors don't invest in mutual funds because they can't like on Robin Hood or Webull and just purchase ETFs. 52 votes, 52 comments. The CCP advice re $50k, stems from an assumption about ETF trading costs. The so-called typical “index fund strategy” is to be globally diversified by buying US, Canada, and “rest of world” because you don’t know which geographies will perform well over the next 30 years. Despite these numbers, I haven't come across many discussions or recommendations about them. The main difference between the two types of product is the stock exchange listing. The index mutual fund market in the US is significantly more competitive and offers comparable fees to ETFs while being simpler to invest in. ETFs, mutual funds and index funds all bundle a diverse portfolio of investments, but are bought, managed and traded differently, and charge different fees. Following this strategy, when you periodically build up a large enough mutual fund position, if it's in a tax-sheltered account, you can then sell and buy the To clear up some terminology, index ETFs are also referred to as index funds. This makes it easy to track the market’s The expense ratio differences are in the noise, and ETFs have the bid-ask spread which makes the difference even a little smaller than it might look. Years ago I made a Questrade account to buy index funds and I still use it today. Also what do you guys… Dec 29, 2024 · Looking for the best index funds for 2025? Check this list of examined index funds that are worth considering adding to your portfolio. My question is - what is the functional difference between throwing spare cash into VOO (a Vanguard 500 ETF), vs directly with Vanguard to invest in an index fund? I know the technical difference is that VOO allows intraday trading, whereas for a true index fund, only the closing price is when you can trade in at. I have normally been risk averse, but now I have a better understanding of financial planning I am leaning towards ETF or some split. 11% while VXUS is 0. Canadians interested in investing and looking at opportunities in the market besides being a potato. Bogleheads are passive investors who follow Jack Bogle's simple but powerful message to diversify with low-cost index funds and let compounding grow wealth. As already mentioned,Reliance NiftyBees (For Nifty50) and JuniorBees (For Nifty Next 50) have good liquidity so imo these are two which are worth buying. If I look at various national markets, however, different countries are good at different things. Also, would you recommend me to diversify my portfolio across multiple etfs or stick to one? Index funds track an index like the S&P 500. ETFs can be traded just like stocks. As someone who literally does AI for a living, never invest in AI companies, it's a cat in a sack until the very last second, might as well fund oil expeditions. You buy (and sell) ETFs on a stock exchange. I take a fairly hands off approach when it comes to investing in index funds. Index funds are not traded on an Dec 24, 2024 · ETFs vs Index Mutual Funds: clarity on the tax advantage please! (self. This is an index fund. So as far as I know, index-based ETFs are still more tax efficient than index-based mutual funds, although there probably won't be a huge impact either way. 4% (best rate from my bank). Learn the benefits and risks of investing in Exchange-Traded Funds, from diverse strategies to tax efficiency. I For a Roth 401k, is there any benefit or preference for Fidelity index funds vs iShares ETFs? I see a lot of people investing in ETF's over Index Funds , what's the big deal? The only difference that I know is that you can buy ETF's throughout the day when the market opens, and you can only buy index funds once a day. It typically has lower fees compared to an actively managed fund which does not follow any specific index. An ETF is a type of investment product, while an index fund refers to an investment strategy. 95 trade fee. They can be bought and sold on an ongoing basis during trading hours. Index Fund returned 5. What you can do is one a year, sell the e-series and transfer to a brokerage and buy an all in one ETF. unhedged funds in the short-term and long-term? Bogleheads are passive investors who follow Jack Bogle's simple but powerful message to diversify with low-cost index funds and let compounding grow wealth. , international, fixed income, cash alternative, all-in-one and—fan favourite—desert-island picks. There are now 2 or 3 brokerages with $0 trading costs for passive index ETFs. You can really do index or mutual funds in retirement accounts as the tax ramifications are less. However, some brokerages offer fractional shares now. So I went and re-read about the topic in a few places. They are not specific investments per se. There are emotional investors and folks that look at fundamentals religiously. To sum up: a mutual fund is a thing where a fund manager pools a bunch of people's money and invests it for them in a big bunch, an ETF is a mutual fund that's traded on a public exchange, and an index fund is a particular kind of mutual fund (that may or may not be an ETF) that uses a stock index to figure out what to invest in. An ETF or a mutual fund can track an index, making either an index fund. Whereas, an ETF if you have $100 and the price is $80, you will buy 1 share and have $20 sitting in cash. These ETFs automatically rebalance, so you just need to buy one ETF instead of two or three. It seems like investing in the SP500 outpaces buying houses and renting them out. Passively managed funds are passive because the fund (whether mutual or ET) only follows a selected index (es) - thus the companies or bonds are predetermined. Learn about budgeting, saving, getting out of debt, credit, investing, and retirement planning. IE, I got an inheritance and put most of it into some generic index funds, then tossed about 10% into a clean energy etf to make me feel good. ETFs are set up to mirror the performance of a stock-market index. They’ll have all the details you need. Market Evolution-The reliance on attracting new investors is not unique to Bitcoin; it is a characteristic of most emerging asset classes. SPY, IVV , VOO are all etf, they are all index funds. Learn how they differ and their pros, cons, fees, and taxation. Just wanting to take advantage of automatic investment is reason enough to use mutual funds. I prefer to hold the ETFs separately that way I can control each specific ETF in my portfolio. Index funds are therefore a type of mutual fund. That competition never happened in Canada, and as a result index ETFs offer a significant cost advantage over index mutual funds here. I think what you're asking is between mutual fund and ETFs, both of which invest passively in an index. Lately I have been bothered feeling I was missing out something of why ETFs were a better approach, maybe tax-wise, or something. Now in passive investing, I had 2 options Index funds and ETFs. Jul 26, 2024 · Reddit, r/ETFs, and its moderators assume no responsibility for the accuracy, completeness, or objectivity of the information presented in this subreddit. Sep 5, 2025 · Discover what an ETF is and how it works. Personally, I think the best 3 fund portfolios have a high growth ETF, S&P 500 ETF, and finally an ETF that tracks the top 1000 companies or even the total stock market. About mutual funds: These are funds managed by fund managers and not all mutual funds are index funds. You probably meant whether there is any difference between I'll be holding Canadian index funds for the rest of my life. And when I say never, I just mean never more than a percentage you're willing to lose completely. ETFs can be traded like a stock intraday whereas index funds are executed at market closing. It's tempting to go with S&P 500 because it's over performed over the last 10 years, but it doesn't always. First, I recommend researching different types of investments like stocks, mutual funds, and ETFs. Traditionally, you would have had to buy ETFs by the share compared to mutual funds where you could buy any dollar amount. I'm just wondering if Questrade is still considered the "go to" platform for this? Just curious to hear your opinions for the best growth ETFs and best income ETFs in Canada in 2023. However I am reading the Bogleheads guide and they advice against ETFs because of the fees and going with index funds. The rebalancing between allocations is done internally for you. An index fund is simply a fund that follows an index. The mutual fund vs ETF choice depends on how much you want to learn, and how much effort you want to put into managing your portfolio, and whether you have the mental tolerance to not fiddle. In Canada, the lowest cost index funds tend to have the ETF structure Canadians interested in investing and looking at opportunities in the market besides being a potato. Looking to max out my TFSA with a combination of both growth and income ETFs. Otherwise they are functionally the same, look for lowest expense ratio and lowest turnover for the index you want your portfolio to track. Up, down, sideways, whatever. 2) Fees A mutual fund and an ETF are only types of investment vehicles. Due to the active nature of some mutual funds they do typically carry higher expenses, however, if you buy an index mutual fund they can be just as low of an expense as an etf. Makes it super easy to buy/sell index funds of all sorts. fcrip sxmckv ahzsvl sgfkjdma zuh shbhugg xoe artz eehi bxvqufu