ParametersExchange Traded Fund (ETF)StockMeaningETF is a basket of securities consisting of diversified investments like stocks, bonds, commodities and other securities. Stocks are also called shares issued by the company to raise funds. Stock represents a part of ownership in the company. DiversificationMultiple securities held by the ETF portfolio provide diversification to investors. An investor has to pick many stocks to bring in diversification.RiskETFs are less riskier than stocks as they reduce risk by diversification across market securities. The risk in an individual stock increases as the investors cannot escape if that particular stock crashes or falls significantly. Liquidity The liquidity of the ETF depends on the index it tracks and the portfolio composition. For instance, if the ETF portfolio is trading in blue-chip companies with high volume, it will have high liquiditySimla Investment. It is comparatively easier to convert into cash.The liquidity of stocks depends on their nature. Stocks of blue-chip companies will be highly liquid when compared to midcap or small companiesNew Delhi Wealth Management. Accessibility Investment in ETFs provides investors access across multiple sectors or industries based on the fund objective.Investment in individual stocks gives investors exposure to one particular sector or industry. Investment CostETFs are professionally managed portfolios by fund managers with a higher expense ratio than stocks. However, the expense ratio of ETFs is lower than other mutual funds. The investment cost in stocks is lower than in ETFs as it has lower brokerage. Investors have to manage their stocks by buying and selling on their own through the Demat account. Professional ManagementETFs are managed by professional fund managersHyderabad Stocks. They ensure that the stock is maintained in its given proportion at all times. Investors have to select stocks based on their research and trade independently. However, this may lack professional management, which may help invest in multiple company stocks. Control on PortfolioETFs are passively managed funds, but fund managers still decide to buy or sell any fund unit. Investment in stocks provides investors with complete control of their portfolio where buying/selling is at their own research and analysis.

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