What are the essential differences between ETF's, closed end funds, and unit investment trusts? - investment trusts
XLF is an exchange traded fund.
QQQQ is a unit investment trust.
MPA is a closed-end funds.
Tuesday, January 5, 2010
Investment Trusts What Are The Essential Differences Between ETF's, Closed End Funds, And Unit Investment Trusts?
2 comments:
QQQQ is not exactly a common fund. It's more of an exchange traded index funds. The two exchange-traded funds and index funds are not managed essentually. The difference between the two is that mutual funds do not try to adjust his return at any point of reference. It is basically a set of assets, usually bonds, bought and sold to the public. They sit there until they are called. With an index exchange-traded fund is minimally achieved. In other words, he always tries to match the performance of the Index is aping. When the rate changes must also change. This happens more often than you can imagine, because of mergers and bankruptcies, and additions and deletions from the index. For example, the Dow Jones Industrial Average is continuously adjusted by deletions and additions.
A closed fund is also an exchange-traded funds. It is an index fund in two important points. First, it has succeeded. Secondly, there are a fixed number of shares will be issued. No additional measures are common, but TSinking fund, you could reduce the number of titles. The important point is that there is a fixed amount of capital that must be discarded. It grows through the issuance of more shares. You can grow only by the increase in net assets, and only then, do not make profits.
Note: At the end tight. You can grow as you sell reinvest dividends / capital gains and some even new shares from time to time. I was in ADX and PEO for 20 years. The differences should not matter to you at all - just dig in.
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