Definition
ETF or Exchange Traded Fund is a Collective Investment Contract whose participation units are listed and traded on the Exchange.

Differences between ETFs and Open Ended Mutual Funds:

1. ETFs are traded on the Exchange during exchange hours, whereas Open Ended Mutual Funds are traded through MI or selling agents.
2. There is no minimum investment for ETFs, unlike Open Ended Mutual Funds which depend on each type of Mutual Fund.
3. Special ETF prices for LQ45 ETF Mutual Funds follow the trend of increasing or decreasing LQ45 index and there is a premium / discount on bid / offer to adjust to market demand, while the price for Open Ended Mutual Funds is determined by NAV (Net Asset Value).
4. ETF price announcements are displayed continuously during trading hours on the Stock Exchange, while Open Ended Mutual Funds are announced once by the Investment Manager based on NAV calculations.
5. Almost all ETFs have market makers (liquidity providers), while Open Ended Mutual Funds do not.
6. Some ETFs have options and/or futures on the underlying in the form of an index or the ETF itself, while Open Ended Mutual Funds do not.