What is a unit trust and an ETF?
A unit trust is a fund that purchases shares or units of the fund, giving you partial ownership in all the underlying assets within that portfolio.
An ETF (Exchange-Traded Fund) is a fund that trades on a stock exchange like a share, but typically tracks an index, sector, or asset class.
Endowus started out offering only unit trusts. As client interest and demand for ETFs have grown, we're now introducing a curated list of ETFs as new building blocks for your portfolio—alongside the unit trusts and alternatives already available on our platform. This gives you access to exposures such as technology, precious metals, specific regions, or treasuries as part of your Endowus portfolio.
Key difference between Unit Trusts and Exchange-Traded Funds
Exchange-Traded Funds (ETFs) and Unit Trusts look and feel largely the same. Here are the key differences between Unit Trusts and Exchange-Traded Funds:
| Feature | Exchange-Traded Fund (ETF) | Unit Trust |
| Trading Channel | Traded on public stock exchanges via brokerage firms | Purchased through fund distributors, banks, investment platforms, or financial advisors. |
| Pricing Dynamics | Real-time continuous market pricing updated throughout trading hours*. *Endowus using Closing price for a start and this is typically available roughly 12 hours after market close | Single forward price calculated once per day based on Net Asset Value (NAV) after market close. |
Why is Endowus offering ETFs?
As a wealth platform built around advice, we added ETFs to expand the range of building blocks available to us, so we can continue building well-diversified, low-cost portfolios that fit your goals—just as we do today with unit trusts.
How is investing in an ETF different from investing in a unit trust on Endowus?
The trading experience is largely the same. There are a few key points that you should be aware of:
- The fund price shown: For ETFs, you'll see the last available closing price, whereas for unit trusts you'll see the net asset value (NAV).
- Trade Date: If orders are submitted before 1230pm, the trade date would be the day of (if it’s a trading day). If orders are submitted after 1230pm, the trade date would be the next business day.
- Settlement time: ETFs usually fully settle between T+1 to T+2, while unit trusts take between T+3 to T+5 to fully settle.
Benefits of investing in ETFs with Endowus versus other platforms
Below are the key benefits of investing ETFs with Endowus:
| Benefit | Endowus | Other platforms |
| Trading and Brokerage fees | None | A fixed fee per trade &/or percentage of AUA |
| FX Spread | None | A percentage of FXed amount |
| Combination of Funds | Unit Trust & ETF funds in a single goal | Solely ETF funds in a single goal/order |
| Fractional units | Available | Available with conditions. |
| Auto-rebalancing | Available | None |