Learn With ETMarkets: Understanding investment options; trading instruments

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Key Points

Dev explained, "It's a type of trading segment in the stock market where investors buy and sell stocks on a delivery basis..

So how and where can we buy mutual funds in India?" inquired Tara.. " Mutual funds are bought and sold at the end of the trading day at the NAV (Net Asset Value) price, which is calculated based on the closing prices of the securities in the fund's portfolio..

While Mutual Funds are bought and sold at the end of the trading day based on NAV, in contrast, ETFs can be bought and sold on the exchanges like NSE and BSE, throughout the trading day, similar to stocks..

Being reminded about the cost comparison, Dev explained Since they are typically passive investments that track a market index, ETFs typically have lower expense ratios than actively managed mutual funds which require more resources and research..

Unlike mutual funds, these investment options have more flexibility in their investment strategies, which means they can trade on both long and short positions and use different asset classes without any restrictions," clarified Dev...

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