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What's better: ETFs or mutual funds?

If you're trying to track the performance of a large index, your results will be similar whether you choose an index fund or an index ETF. But which is right for you comes down to whether you want to invest a big chunk of money all at once, or smaller chunks of money over time.

If you want to invest a big chunk at once - for example, you're doing a rollover of a 401(k) or an IRA - you're better off with an ETF. By contrast, if you want to invest $200 a month (or you tend to invest sporadically with modest amounts of money), you're probably better off in a regular mutual fund; overall, the fees will be lower.