Explain which is the better approach

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Reference no: EM132012824

Suppose you just inherited $25,000 from your Aunt Louise. You have decided to invest in an S&P Index fund, but you haven't decided yet whether to use an ETF or a mutual fund. Suppose the ETF has an annual expense ratio of .09 percent, while the mutual fund charges .21 percent.

The mutual fund has no load, but the ETF purchase would carry a $25 commission.

Assuming this is a long-term holding and you are not concerned about being able to margin or short sell, which is the better approach?

Reference no: EM132012824

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