Exchange-traded fund
Investment fund traded on stock exchanges
Investment fund traded on stock exchanges
An exchange-traded fund (ETF) is a type of investment fund that is also an exchange-traded product; i.e., it is bought and sold on stock exchanges. ETFs own financial assets such as stocks, bonds, currencies, cryptocurrency, debt, and futures contracts, as well as commodities such as gold bars. ETFs provide more diversification than owning an individual stock and more market liquidity than owning an individual bond. Most equity and fixed-income ETFs are index funds; they use passive management to replicate the performance of a stock market index or bond market index. These indices can be broad-based, such as the S&P 500 or Nasdaq-100 or focus on a certain industry such as the technology industry or the financial industry, a certain quality such as growth stocks or value stocks, a certain market capitalization, a certain factor such as high dividend stocks or value, momentum, quality, and low volatility, or a certain theme such as climate change, cloud computing, robotics, electric vehicles...
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