Sunday, January 13, 2008

Index Fund or ETF?

Mr Tan,

Should I invest in an Exchange Traded Fund and an Index Fund? Both funds track an index.

http://stquote.sgx.com/live/st/STETF.asp http://www.lioncapital.com.sg/default.asp?action=category&ID=24&order=rank&sort=asc&limit=0

REPLY

If you are investing for the long term (and not trading for the short term), it is better to buy an indexed fund, as it is based on the net asset value of the fund at the end of the day. You do not have to worry about trading based on the actual price fluctuation during the day.

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