Index Funds, Exchange-Traded Funds (ETFs)

Eleanor Laise, The Wall Street Journal, compares and contrasts index funds and exchange-traded funds (ETF) in this in-depth article from the Pittsburgh Post-Gazette. She notes that, "In general, traditional index funds are best for people who make regular contributions to their account. That is because you must pay a commission to buy or sell an ETF, while index funds often cost nothing to trade. ETFs, by contrast, tend to be better for investors who want to make bets on narrow market segments, trade during the day, or use sophisticated trading strategies." Laise also provides a detailed guide covering costs, tax consequences, and performance.

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(May '04-Jun '05)