Exchange Currency

Exchange Traded Fund

ETF. A fund that tracks an index, but can be traded like a stock. ETFs always bundle together the securities that are in an index; they never track actively managed mutual fund portfolios (because most actively managed funds only disclose their holdings a few times a year, so the ETF would not know when to adjust its holdings most of the time). Investors can do just about anything with an ETF that they can do with a normal stock, such as short selling. Because ETFs are traded on stock exchanges, they can be bought and sold at any time during the day (unlike most mutual funds). Their price will fluctuate from moment to moment, just like any other stock's price, and an investor will need a broker in order to purchase them, which means that he/she will have to pay a commission. On the plus side, ETFs are more tax-efficient than normal mutual funds, and since they track indexes they have very low operating and transaction costs associated with them. There are no sales loads or investment minimums required to purchase an ETF. The first ETF created was the Standard and Poor's Deposit Receipt (SPDR, pronounced "Spider") in 1993. SPDRs gave investors an easy way to track the S&P 500 without buying an index fund, and they soon become quite popular.

Related information about Exchange Traded Fund:
  1. Exchange-traded fund - Wikipedia, the free encyclopedia
    An exchange-traded fund (ETF) is an investment fund traded on stock exchanges , much like stocks. An ETF holds assets such as stocks, commodities, or bonds, ...
     
  2. Exchange-Traded Fund (ETF) Definition | Investopedia
    A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange. ETFs experience price changes ...
     
  3. Exchange-Traded Funds (ETFs)
    Mar 18, 2010 ... Instead, they buy Creation Units with a basket of securities that generally mirrors the ETF's portfolio. Those who purchase Creation Units are ...
     
  4. Exchange Traded Funds | Invest in ETFs
    What exactly is an exchange-traded fund (ETF)? "Exchange-traded" refers to shares that trade all day long on the major stock market exchanges (just like regular ...
     
  5. Exchange-traded fund - Wiki | The Motley Fool
    However, if you want to trade shares of an index during the day, then the ETF is for you. These are like index funds in that they own shares of the companies that ...
     
  6. Exchange-Traded Funds (ETF) Center - Yahoo! Finance
    Learn about Exchange-Traded Funds, read ETF news, and see which ETFs are peforming the best with Yahoo! Finance's ETF Center.
     
  7. About Exchange-Traded Funds (ETFs) - Bloomberg
    An exchange-traded fund, or ETF, is an investment product representing a basket of securities that track an index such as the Standard & Poor's 500 Index. ETFs ...
     
  8. exchange traded fund - The Free Dictionary
    Noun, 1. exchange traded fund - a mutual fund that is traded on a stock exchange . ETF · mutual fund - the pooled money that is invested in assets ...