Thursday, May 2, 2013

Index Funds vs Index ETFs

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Underlying portfolio of an index fund and ETF is same but their structure is completely different...

 

Both ETFs (Exchange Traded Funds) and Index funds track the performance of an Index like Sensex or Nifty. Although the underlying portfolio of an index fund and ETF is same but their structure is completely different.

 

Index funds are open-ended mutual funds which invest money in the same weightage and companies that comprise the index. While ETFs are like closed-ended funds.

 

Their units are created and listed on stock exchanges. You can buy ETF units only from an exchange. ETFs are managed more efficiently in India and have a smaller tracking error. ETFs also have a lower expense than index funds. Majority of the index funds have an expense of 1.5 per cent while that of ETFs range between 0.25 and 1 per cent. ETFs are a better way of replicating an index.

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

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Tax Saving Mutual Funds Online

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Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

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  5. Birla Sun Life Tax Relief '96 Invest Online
  6. IDFC Tax Advantage (ELSS) Fund Invest Online
  7. SBI Magnum Tax Gain Scheme 1993 Invest Online
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  9. Edelweiss ELSS Invest Online

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      2. ICICI Prudential Regular Gold Savings Fund
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