What's the difference between ETF funds and ordinary funds?
1, trading places
ETF funds can be traded off-site or in the secondary market. Ordinary open-end funds are not allowed to go public.
2. Trading time
Some ETF funds conduct T+0 transactions; General funds generally implement T+ 1 transaction.
3. Transaction costs
The transaction cost of ETF funds is low, and generally only the transaction commission is charged, and stamp duty and other fees are not charged. The trading conditions can be paid in cooperation with securities companies. There are many expenses for general funds, such as subscription fee, redemption fee, management fee and custody fee.
4. Trading method
ETF has real-time transaction price in the secondary market, so it can be bought and sold at any time through stock trading, and its own quotation is waiting for others to make a deal. The delay in the subscription and redemption of ordinary funds shall be calculated according to the net fund value.
5. Fund share
ETF fund share is fixed; The total share of general funds is not fixed, because the number of subscriptions and redemptions is not fixed.
6. Will it be arbitrage?
ETF funds can be traded on and off the market, or in the secondary market, using the difference between the secondary market price and the fund's net value for arbitrage, while ordinary funds can't.
Which is better?
The two cannot be compared in detail, and they need to be selected according to investors' investment preferences and investment purposes.
1. If investors pursue high returns, it is recommended to buy general funds. For example, stock funds, partial stock hybrid funds and so on. These funds aim to pursue high market returns.
2. If investors want to make short-term investments, it is recommended to choose ETF funds and ordinary funds for a long time. Some ETF funds can trade T+0, similar to stocks, and pursue the same market returns as the index. Ordinary funds can't buy on the same day, they can only sell on the same day. It is recommended to hold it for a long time.