Hello!
I am looking into investing into an S&P 500 fund but, not sure if I want to do an Index or ETF. I am going this route because I can’t realistically buy stocks in all the top companies. I am new to investing and I can’t wrap my mind around what the biggest difference is. I believe the ETF has lower costs associated with it. I have done research on both but, clearly my brain is overloaded lol. This stuff seems like a foreign language when you are just learning. Just wondering which one is the better option? or if they are both equally good ways to invest for someone who can’t afford to invest in all the top companies at once. Any pointers would be appreciated!
Hope this helps! I had similar questions but this article helped me out a while back.
https://www.personalfinanceclub.com/whats-the-difference-between-an-index-fund-and-an-etf/
This was extremely helpful! Thank you!
Most people tend to prefer the mutual fund version because you can invest any dollar amount versus having to buy full shares.
The downsides would be some mutual funds have minimum investment amounts ($3K for Vanguard mutual funds), and the expense ratio can be minimally higher (~.01%)