The exchange traded fund (ETF) world and the mutual fund industry are competing for investors left and right, and the commodity sector is no exception. The choice for exposure is now readily available in both forms. But which is superior?
One of the questions it comes down to is whether you prefer active or passive management. The differences between mutual funds and ETFs still exist when considering funds that cover the commodities space. (Why mutual funds want in on ETFs).
Overall, passive ETFs cost less than active mutual funds, on average. ETFs also trade all day on an exchange like a stock; mutual funds trade just once. (What will it take for ETFs to overtake mutual funds?)
Don Dion for TheStreet outlines a few of the differences: