The law of supply and demand tells us that when demand for something increases, then price should also increase. What happens to the price of underlying securities when demand increases, or decreases, for ETFs? Not what you might expect.
It’s hard not to notice the sibling rivalry going on in the investment industry. Mutual funds represent the long-standing status quo, and ETFs are the now not-so-young upstarts. But what matters the most is an investment’s strategy, not its wrapper.
Much of the perceived difference between ETFs and mutual funds stems from strategy, not structure.
Want to limit all-in fees over the life of an ETF or mutual fund investment? The time horizon matters.