OEICs v ETFs v ITs

jamesd

If you just want to limit cost with passive choices, either the ETF or the fund option could be cheapest. Depends on the pricing of each specific fund/ETF.

Something to watch out for in ETFs is whether they are "physical" and really hold the underlying investments or not. Some just hold security of some sort and use derivatives to track the index. Those can be cheaper to manage and lower priced because less buying and selling of shares is needed. I've never noticed an OEIC do this for a tracker.

colesy

jamesd wrote: »

Something to watch out for in ETFs is whether they are "physical" and really hold the underlying investments or not. Some just hold security of some sort and use derivatives to track the index. Those can be cheaper to manage and lower priced because less buying and selling of shares is needed.

Synthetic ETFs are accompanied by counterparty risk though.