Mutual funds and exchange-traded funds (ETFs) are both popular investment options, but they have some key differences and similarities.

One major difference is how they are traded. Mutual funds are bought and sold at the end of the trading day at their net asset value (NAV), while ETFs are traded throughout the day on stock exchanges at market prices.

Another difference is in their management style. Mutual funds are actively managed by fund managers who aim to outperform the market, while most ETFs are passively managed to track a specific index.

Furthermore, mutual funds often have higher expense ratios and fees compared to ETFs, which can impact overall returns for investors.

For example, the Vanguard 500 Index Fund is a popular mutual fund that aims to mirror the performance of the S&P 500 index. On the other hand, the SPDR S&P 500 ETF (SPY) is an ETF that also tracks the performance of the S&P 500.

Both mutual funds and ETFs offer diversification and professional management, making them suitable for long-term investors. However, understanding their differences in trading, management style, and fees can help investors make informed decisions based on their investment goals and risk tolerance.