How is an ETF different from a tracker (mutual) fund?
ETFs are very similar to tracker funds in that they are both a great way to get exposure to a market through a single investment. ETFs however are often seen as a modern version of a tracker fund. Here’s how they differ.
- Wider choice. From tracking single indexes such as the FTSE 100 to global themes such as clean energy, ETFs offer a wider range of options for investors to choose from.
- ETFs are also more transparent so you can always view the underlying investments. Tracker funds typically only release their holdings monthly.
- ETFs however trade throughout the day – meaning you can invest in and out of them quickly. This compares to tracker funds which typically only trade once per day. Please note Moneybox does not currently offer live ETF trading.
