Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Exchange Traded Fund is a passively managed fund that tracks an index or asset and trades on stock exchanges like a share.
An ETF is a basket of stocks or gold you buy through your demat account — usually cheaper than active mutual funds.
ETFs offer intraday trading, typically lower expense ratios, and transparent holdings. Tracking error measures deviation from index. Liquidity depends on market makers and volume on NSE/BSE.
Nifty BeES ETF at ₹250 per unit gives exposure to Nifty 50. Buying 100 units for ₹25,000 mirrors index performance minus small tracking difference and costs.
ETFs suit demat holders wanting lower costs and intraday access. Index funds suit SIP without demat and automatic transactions.
Dividend ETFs distribute constituent dividends. Accumulating ETFs reinvest internally, similar to growth mutual fund options.
Difference between ETF return and index return due to expenses, cash drag, and replication method. Lower is better.