I new and I don’t know what the benefits is of Index Fund ETFs over Index Funds (or vice versa) for long term investing. I’m talking about long term investing with monthly dollar cost average tracking a large index like S&P 500.
From what I know, comparing both Index Fund ETFs vs Index Funds: - Most companies don’t have minimum initial investment for index funds, this means I can start off with $10 investing in index funds. ETF can be bought fractionally which also means I can start investing with $10 so there isn’t a difference here. - Expense ratio seems to be almost the same/negligible (0.01% difference). If a company has their ETF’s expense ratio cheaper than their index funds, chances are I can find a competitor company with index funds’s expense ratio being similar or cheaper if I really cared about that 0.01% difference. - Investing for the long term means I don’t bother too much about timing the market within the day, I just invest the same amount every month till I retire. - A lot of these new fintech companies allow automatic withdrawal from my back account even if I’m investing in ETFs; otherwise, spending 5 minutes a month transferring money is no big deal.
So in terms of investing in something that tracks the index, is one better than the other? Am I missing something? If you invest in one and not the other, why did you choose that and not the other?
Submitted July 16, 2022 at 02:01AM by lipuss https://ift.tt/j5t498p
