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 and generally operates with a computer-assisted trading mechanism designed to keep it trading close to its net asset value.
In short, an ETF is a kind of investment fund that is tied to the price of an underlying asset — a commodity, an index, bonds, or a basket of assets — like an index fund and is traded on exchanges, available to both retail and institutional investors.
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For more info about ETF, visit following links.
ETF.com
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