Exchange Traded Fund , better known as ETFs, are investment funds listed on the stock market as well as shares.
Unlike traditional funds, it is not necessary to wait for the liquidation value of the closing to carry out purchase or sale operations, since they can be contracted at any time during the trading hours of the market, and even liquidate it on the same day.
ETFs can be acquired through a stock exchange, or through an online broker .
There are ETFs for all types of investors, from which they completely replicate the behavior of an index, as is the case of the SPY, which replicates exactly the SP 500. There are also ETFs that replicate the movements of gold, oil, natural gas, etc.
This type of instrument is a great advantage for short-term investors, since it allows entering and leaving the market easily.
For example, if you want to invest in gold, thinking in the short term, instead of acquiring the metal, with all the costs that implies, you can buy with just one click an ETF that replicates its value (GLD).
In the graph below you can see the evolution of Gold in the last year .
The GLD ETF has exactly the same gold behavior in the same period of time
There are several brokers to invest in ETFs, being Plus500 one of the most recommended, since you can open an account from US $ 100, and also has competitive spread and high liquidity.