Which of the following is a difference between an exchange-traded fund (ETF) and a mutual fund?
A) An ETF is a fixed-income instrument, whereas a mutual fund is a variable-income instrument.
B) An ETF can only be traded at the end of the day, whereas a mutual fund can be bought or sold throughout the trading day.
C) An ETF provides more favorable tax treatment than a mutual fund.
D) An ETF is a convertible security, whereas a mutual fund is a nonconvertible security.
E) An ETF is a hybrid security, whereas a mutual fund is not a hybrid security.

Question

Quizplus · Accepted Answer

ETFs often provide more favorable tax treatment compared to mutual funds due to their unique structure and the way transactions are executed, which can result in fewer capital gains tax events for investors.

Which of the Following Is a Difference Between an Exchange-Traded