What's the difference between etf fund and lof fund?
The full name of etf fund is "exchange-traded fund", and the Chinese name is "exchange-traded fund". Simply understood, it refers to an open-end fund with variable fund shares that can be traded on the stock exchange. It has the operational characteristics of both closed-end funds and open-end funds, and can be listed in the secondary market as a "fund unit" and traded at any time within one day. At the same time, you can also purchase or redeem fund shares from fund management companies in the primary market.
Etf funds and lof funds have the following differences:
1 There are different trading methods.
At the time of subscription or redemption, etf funds exchange fund shares and "a basket" of stocks with investors, while lof funds exchange cash with investors.
2 The quotation frequency is different
On the net quotation of the secondary market, etf funds provide a net quotation every 15 seconds, and lof funds provide a net quotation every day.
3 different in nature
Etf fund is essentially an index open-end fund, which is passively managed. Lof fund is an ordinary open-end fund, which increases the trading methods of the exchange. It may be an index fund or an actively managed fund.
4 The place of purchase and redemption is different.
Etf funds are traded on the exchange, that is, they are traded on the exchange, while lof funds can be traded on the exchange or over the counter, that is, they can also purchase and redeem fund shares at designated outlets.
5 different trading thresholds
The trading threshold of etf funds is relatively high, with a minimum trading threshold of 500,000 copies. Lof funds have no special requirements for subscription and redemption, and ordinary investors can also participate.
The above are some contents of etf fund and lof fund, hoping to help you.
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