What is ETF?
Exchange-Traded Fund — a basket of assets you can buy like a single share, e.g. one ETF holding all 500 S&P companies.
An exchange-traded fund (ETF) is a fund that trades on a stock exchange like a single share. One ETF can hold hundreds or thousands of securities — for example all 500 companies of the S&P 500 — or a commodity such as gold.
ETFs are popular because they are cheap, transparent and easy to trade, and they make diversification simple. Most track an index passively; some are actively managed.
Investors in the EU usually buy UCITS versions of ETFs, because many US-listed ETFs are not available to retail investors there.
Related terms
See ETF applied to real markets — 30 markets, decades of data — in the Research Terminal.
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