What are index funds?

Like most ETFs, index funds also track an index as accurately and cost-effectively as possible. The main difference between the two product types is that ETFs are listed on the stock exchange and can be bought and sold continuously during trading hours. Index funds are not traded on the stock exchange. As with active investment funds, buying and selling is only possible once a day via the fund provider. One advantage of index funds is that there are withholding tax-free unit share classes for Pillar 3a.

Due to this tax advantage, we also use index funds in addition to ETFs in Pillar 3a.