![]() This is different from mutual funds which are priced once daily at the end of the trading day, after the market closes. ETFs are traded (bought and sold) on a stock exchange – similar to stocks – with the price fluctuating throughout the trading day. Since there's no active security selection, you would pay a lower management expense ratio (MER) compared to mutual funds that are actively managed.Īnother key difference between ETFs and mutual funds is pricing. That index tracks about 250 of Canada's largest public companies on the Toronto Stock Exchange. ![]() For example, you could purchase an ETF that tracks the S&P/TSX Composite Index. While actively managed ETFs do exist, and are gaining popularity, this article will primarily focus on index-tracking ETFs.įor index-tracking ETFs, they track a particular index. An important difference between ETFs and mutual funds is that many ETFs are passively managed. ![]() ETFs are similar to mutual funds in the sense that they're a pooled investment vehicle featuring dozens or hundreds of individual securities depending on the index they track. ![]()
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