Simply Save | Which is better to invest, index funds or exchange traded funds?

Investor interest in passively-managed funds has been rising. Investors can make their passive investments through index funds, as well as exchange traded funds (ETFs).

While both these types of funds can be used for passive investing, there are quite a few differences between the two that investors should be aware about. 

For example, in an ETF you can end up investing at a premium to the index’s actual price, as the ETF may not be able to closely track price of the index throughout the day. In the index fund, you can only invest at end of the day NAVs, as these are not traded on the exchanges.