Investing in passive mutual funds? Beware of these 7 misconceptions before investing – Passive investing

Within passive investing, investors can choose between index funds and ETFs. While both do the same job—mimicking the underlying index—they often differ in cost, liquidity, and tracking error. Since passive investing is about minimising costs, investors conclude ETFs will always win. Furthermore, ETFs offer real-time trading, so investors consider them more efficient and liquid.