Exchange-traded fund
Also called: ETF, ETFs
A fund, usually tracking an index, whose units trade on the stock exchange through a broker at market prices during the day.
An ETF's price normally stays close to its NAV, but thinly traded ETFs can trade at a premium or discount and with wide spreads. Buying requires a demat and trading account and incurs trading charges.
Learn more in these lessons
- Index funds and ETFsHow do index funds and ETFs work, and do they all return the same?
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