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Trading decisions
Unit trust portfolio managers make buy or sell decisions based on their underlying views of each stock in their unit trust portfolio. ETF managers do not make any such decisions – the decision to buy and hold any one security will depend on whether the security is held in the index, and how its holding size compares to the index weight.
Running costs
ETFs are passively managed, whereas unit trusts are actively traded by salaried fund managers. The running costs of ETFs are obviously considerably lower.
Pricing and trading
Unit trusts are priced and traded at set intervals, but ETFs - like any other securities – are re-priced continuously in accordance with market movements and can be traded at any time during normal JSE trading hours.
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