General
What is an ETF unit?
A unit of ETF is the smallest unit that can be traded at an exchange. This is similar to one share of a company. Like shares, ETF units are directly deposited into your demat account when you buy them. ETF units are one share, that represent a proportional ownership stake, of the portfolio; here, the portfolio is the underlying asset/index that is tracked by the index.
Difference between MF, ETF and direct equity
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Feature
ETF
Direct Equity
Mutual Fund
What you invest in
A basket of securities tracking an asset/index
Shares of a single company
A professionally managed portfolio
Price
Real-time market price
Real-time market price
End-of-day NAV
Minimum investment
1 unit’s price
1 share’s price
Based on the scheme
Management style
Passively managed by fund manager
Managed by investor
Actively and passively managed by fund manager based on the scheme