How do I find an ETF that is similar in investment goals to a given Mutual Fund?

Asked by: Cynthia Herrera

How do I choose a similar ETF?

Choose the ETF with the lowest volatility

Among similar ETFs, choose the one with lower volatility—a measure of the range of price fluctuation you can expect. Even among index-tracking ETFs with similar objectives, there are factors that can affect their volatility. One is the way the holdings are weighted.

How is an ETF similar to a mutual fund?

The biggest similarity between ETFs (exchange-traded funds) and mutual funds is that they both represent professionally managed collections (or “baskets”) of individual stocks or bonds.

Should you mix mutual funds and ETFs?

One tends to be cheaper to own and the other tends to perform better during down markets. That’s why I recommend going with a combo strategy. Both mutual funds and exchange-traded funds (ETFs) are designed to give investors great diversification.

How is an ETF similar yet different from a mutual fund?

While mutual funds and ETFs are similar in many respects, they also have some key differences. A major difference between the two is that ETFs can be traded intra-day like stocks, while mutual funds only can be purchased at the end of each trading day based on a calculated price known as the net asset value.

What is the best ETF to buy and hold?

Seven best long-term ETFs to buy and hold:

  • iShares Core S&P 500 ETF (IVV)
  • Schwab U.S. Small-Cap ETF (SCHA)
  • iShares Core S&P Mid-Cap ETF (IJH)
  • Schwab U.S. Dividend Equity ETF (SCHD)
  • Vanguard Total Stock Market ETF (VTI)
  • Vanguard Total International Stock ETF (VXUS)
  • Vanguard Long-Term Corporate Bond ETF (VCLT)

What is the best performing ETF?

7 best ETFs to buy now:

  • Invesco DB Commodity Index Tracking Fund (DBC)
  • ProShares K-1 Free Crude Oil Strategy ETF (OILK)
  • Invesco Dynamic Energy Exploration & Production ETF (PXE)
  • iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX)
  • Simplify Interest Rate Hedge ETF (PFIX)
  • Tuttle Capital Short Innovation ETF (SARK)

Do ETFs outperform mutual funds?

Mutual funds may require a minimum investment. When following a standard index, ETFs are more tax-efficient and more liquid than mutual funds. This can be great for investors looking to build wealth over the long haul. It is generally cheaper to buy mutual funds directly through a fund family than through a broker.

Why choose an ETF over a mutual fund?

Exchange-traded funds (ETFs) take the benefits of mutual fund investing to the next level. ETFs can offer lower operating costs than traditional open-end funds, flexible trading, greater transparency, and better tax efficiency in taxable accounts.