Investing in ETFs For Dummies
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Investing in ETFs differs from investing in mutual funds and individual stocks in some important ways, as the following table shows. As a smart investor, you can't ignore the advantages that ETFs offer.

ETFs Versus Mutual Funds Versus Individual Stocks
ETFs Mutual Funds Individual Stocks
Priced, bought, and sold throughout the day? Yes No Yes
Offer some investment diversification? Yes Yes No
Is there a minimum investment? No Yes No
Purchased through a broker or online brokerage? Yes Yes Yes
Do you pay a fee or commission to make a trade? Typically Sometimes Yes
Can that fee or commission be more than a few dollars? No Yes No
Can you buy/sell options? Sometimes No Sometimes
Indexed (passively managed)? Typically Atypically No
Can you make money or lose money? Yes Yes You bet

About This Article

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About the book author:

Russell Wild is a NAPFA certified financial advisor and principal of Global Portfolios, an investment advisory firm based in Allentown, PA that works with clients of both substantial and modest means. He has written two dozen books and numerous articles on financial matters.

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