Closed-end funds adopt a closed operation mode, that is, within the term of the fund contract, the approved total fund share is fixed, and the fund share can be established according to law ... Open-end funds adopt an open operation mode, that is, the total fund share is not fixed, and the fund share can be purchased or redeemed at the time and place agreed in the fund contract. ...

First, general open-end funds can only be opened once a day, and investors only have one trading opportunity every day (that is, subscription and redemption); ETF is listed on the exchange and can be traded at any time during trading hours.

Second, open-end funds often need to keep some cash for redemption, while ETF redemption is to deliver a basket of stocks, which is convenient for managers to operate and can improve the management efficiency of fund investment.

Compared with closed-end funds, ETFs have the following advantages:

First, it is more transparent. Because investors can continue to purchase and redeem, the frequency of asking fund managers to announce their net worth and portfolio is also accelerated accordingly.

Second, due to the existence of the continuous subscription and redemption mechanism, there will not be much discount premium between the net value of ETF and the market price in theory. In other words, the phenomenon that the discount rate of domestic closed-end funds is generally higher than 20% is difficult to appear in ETFs.