Performance comparisons between ETFs and traditional index funds: Evidence from China

Chunying Wu, Xiong Xiong and Ya Gao

Finance Research Letters, 2021, vol. 40, issue C

Abstract: Passive investment might be the mainstream of individual investors in the Chinese stock market. Thus, it is important to understand and choose among the multiple passive vehicles following any index. Our results indicate that ETFs have relatively better performance than the index funds, both pre-expense and post-expense. Further examination shows the decentralization effect of ETF during the turbulent period is greater than that of index funds, but the benefits of diversification through this investment vehicle are limited.

Keywords: Index funds; Exchange traded funds; Comparative performance (search for similar items in EconPapers)
JEL-codes: G10 G11 G12 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:40:y:2021:i:c:s1544612320305389

DOI: 10.1016/j.frl.2020.101740

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