What are the mutual funds and ETFs and what are their pros and cons as low cost investment options?

-- Rachel

Mutual Fund and ETF’s are “funds” basically one investment that allocates your money into a bunch of different investments, think of it like crowdsourcing, where you are investing in “Vanguard” and then Vanguards pools together hundreds of other to buy a stock like AAPL, so you do not own 1 share of apple you own part of one share, but you are very diversified and protecting your risk. Mutual Funds are managed by Fund Managers who then charge a fee to be part of their portfolio, this could be a negative, ETF’s allow same benefits as a Mutual Fund but for a way lower Fee which is an advantage, the disadvantage is that there is not as many ETF’s as there is Mutual Funds.

Have a questions? Contact Us 

Subscribe to stay up to date on all things Orca

Related Posts