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re: Mutual Funds vs ETFs for taxable account investing

Posted on 3/13/24 at 8:12 pm to
Posted by slackster
Houston
Member since Mar 2009
85489 posts
Posted on 3/13/24 at 8:12 pm to
quote:

How so? Wouldn’t an index etf hold the index similar to a fund?


Yes but when a stock is replaced in the S&P 500, the index fund has to sell it. Kinda. It’s complicated, and there are ways around it that the big players avoid (Vanguard/BlackRock). Just know that even though it’s very rare from index mutual funds, their structure is more prone to CG distributions than an ETF’s structure.

It’s so rare in index mutual funds that’s it’s not really worth considering under current law.
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