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Basis of Distinction
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Mutual Fund
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ETF
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Fund management
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Actively managed by fund manager or professionals. |
They are passive investment options that track the performance of an index. |
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Buy & Sell
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MFs can only be purchased from a fund house even though these can be listed on the exchanges. |
ETFs can be actively bought and sold on the exchanges. |
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Minimum Investment
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It may have high minimum investment amounts. |
ETFs do not require a minimum initial investment. It can be just 1 share. |
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Minimum Lock-in Period
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Usually, it involves some minimum lock-in period, and selling the units before this period may attract a penalty. |
Generally, do not have any minimum lock-in period. |