Which is better, enhanced index fund or ordinary index fund?
Mainly depends on the management level of fund managers. If the level of fund managers is high, then investors can choose enhanced index funds; However, low-level fund managers may even underperform the index.
Enhanced index funds and ordinary index funds as long as the differences are as follows:
The replication degree of 1 is different: ordinary index funds are passively replicated, and the goal is to make the fund trend consistent with profit and loss; Enhanced index funds are actively managed and strive to earn more than the index.
2 different rates: passive index funds have fewer human interference factors, and management fees and custody fees will be less; Enhanced index funds, run by fund managers, have higher management fees and custody fees.
3 Different types of expenses: ordinary index funds generally trade on the market, and pay commissions to brokers when trading on the market, while enhanced funds generally invest off-market, and the expenses mainly include subscription, redemption, sales and services.