ETFs	Mutual Funds
How are they managed?	While they can be actively or passively managed by fund managers, most ETFs are passive investments pegged to the performance of a particular index.	Mutual funds come in both active and indexed varieties, but most are actively managed. Active mutual funds are managed by fund managers.
How are they traded?	ETFs trade like stocks and are bought and sold on a stock exchange, experiencing price changes throughout the day. This means that the price at which you buy an ETF will likely differ from the prices paid by other investors.	Mutual fund orders are executed once per day, with all investors on the same day receiving the same price.
What's the minimum investment?	Because they trade like stocks, ETFs do not require a minimum initial investment and are purchased as whole shares. You can buy an ETF for the price of just one share, usually referred to as the ETF's "market price."	Minimum initial investments for mutual funds are normally a flat dollar amount and aren’t based on the fund's share price. Unlike ETFs, mutual funds can be purchased in fractional shares or fixed dollar amounts.
What are the costs?	ETFs have implicit and explicit costs. While your broker will disclose the cost of trading commissions and the ETF provider will disclose the operating expense ratio, don't overlook the bid/ask spread and premium/discount to NAV. These costs are implicit and result from buying or selling an ETF in the market at a price which may differ from the value of the ETF's underlying holding.  Read ETFs: How much do they really cost?	Mutual funds can be purchased without trading commissions, but in addition to operating expenses they may carry other fees (for example, sales loads or early redemption fees).
What about tax efficiency?	ETFs can potentially generate fewer capital gains for investors since they may have lower turnover and can use the in-kind creation/redemption process to manage the cost basis of their holdings.	A sale of securities within a mutual fund may trigger capital gains for shareholders—even for those who may have an unrealized loss on the overall mutual fund investment.