exchange-traded fund

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exchange-traded fund

(ETF), in finance, an investment company that in exchange for the deposit of a portfolio of stocks, bonds, commodities, or other assets issues securities that represent those assets and may be traded like shares of stock. Shares in an ETF may only be issued to the fund's authorized participants, typically large financial institutions, and usually in a large block of 10,000 to 50,000 shares, known as creation units. Shares in an ETF must also be redeemed in creation units. ETF shares may be purchased and traded by most individual investors using a brokerage account.

Most ETFs are similar to index funds (see mutual fundmutual fund,
in finance, investment company or trust that has a very fluid capital stock. It is unique in that at any time it can sell or redeem any of its outstanding shares at net asset value (i.e.
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) in that they represent a portfolio that is designed to track an index of a financial market, such as the S&P500. ETFs, however, track a greater range of indexes and thus offer more options and more specifically targeted choices for an investor. Unlike shares in a mutual fund, which may be redeemed only at the end of the business day when the net asset value is determined, ETF shares may be bought or sold at any time on an exchange and also may be sold short and purchased on margin, which is useful for traders. In general, compared to mutual funds, ETFs are more useful to the active trader with larger financial resources than to the long-term small investor. The first ETF was created in 1993 in the United States; the number of ETFs and amount of money invested in them grew significantly in the early 21st cent.

References in periodicals archive ?
New Delhi [India], July 19 ( ANI ): The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi on Wednesday authorized the Alternative Mechanism for creation and launch of a New Exchange Traded Fund.
Named "NEXT FUNDS Nomura Enterprise Value Allocation Index Exchange Traded Fund" (ticker: 1480), the new ETF was today approved for listing by the Tokyo Stock Exchange (TSE) with a launch date of May 18 and a listing date of May 19.
During the two day meetings, ADX and KRX discussed a joint project to develop Exchange Traded Funds (ETF) in the Abu Dhabi stock exchange, and both parties also proposed expanded cooperation on matters relating to Central Counterparty Clearing (CCP), dual listing companies in both exchanges as well as jointly developing and supporting other capital markets.
Commissions, management fees and expenses all may be associated with investments in exchange traded funds. Please read the prospectus before investing.
He said, "For the first time, overseas retail investors (in Mauritius) will get an opportunity to invest in Indian G-Secs via an exchange traded fund. "MCB is the largest bank there.
Tiburon Strategic Advisors LLC, Tiburon, Calif., published this finding in a new report, "ETFs and Indexing: Exchange Traded Funds, Index Mutual Funds & Indexed Separate Accounts." The research provides an overview and market forecast of exchange-traded funds, index mutual funds and indexed separate accounts.
"Now, with our introduction of these new ProShares, investors for the first time can get leveraged or inverse exposure to VIX futures with an exchange traded fund."
Virtus ETF Advisers is a multi-manager exchange traded fund (ETF) sponsor and affiliate of Virtus Investment Partners, that offers a range of complementary exchange-traded-funds sub-advised by select investment managers.
8 September 2016 - US-based exchange traded fund provider Amplify ETFs has acquired US-based exchange traded fund sponsor YieldShares LLC, the company said.
Nomura, Asia s global investment bank, today launched the Nomura Nikkei 225 Euro-Hedged UCITS Exchange Traded Fund and the Nomura Nikkei 225 US Dollar-Hedged UCITS Exchange Traded Fund .
The World Gold Council (WGC) said it has appointed Jason Toussaint as Managing Director of Exchange Traded Gold (ETG), the World Gold Council's global initiative designed to promote and develop the gold Exchange Traded Fund (ETF) and Exchange Traded Commodity (ETC) market.
The non diversified, actively managed exchange traded fund is subject to management risk because it is an actively managed portfolio.