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Are there any drawbacks to managed ETF?
Asked by unknown
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A managed ETF has certain drawbacks like high pressure on the manager of the fund to outperform the market index, which leads to a higher expense. Also, even though these ETFs are managed by an expert or a team of experts, there may be times when they underperform. Apart from that, managed ETFs are usually less diversified.
What is ETF?
Asked by unknown
1 Answers
ETF stands for Exchange-Traded Fund, which is an investment fund that involves securities like stocks or bonds based on the market index. Often mistaken for mutual funds, ETFs are listed on exchanges and can go through daily trade. They have a price associated with them that makes it easy to buy and sell them.
What is a managed ETF?
Asked by unknown
1 Answers
This type of ETF is actively managed by someone, either an individual or an entire team of experts. This leads to a higher cost, and the returns are based on the management and correct decisions. At times, managed ETF may be beneficial as the expert management aims for higher returns than normal market index predictions.