exchange-traded fund

(redirected from Exchange-traded)
Also found in: Dictionary, Thesaurus, Financial.

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.
..... Click the link for more information.
) 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 ?
exchange-traded bonds of Public Joint-stock Company Magnit with Issue Identification Number 4B02-03-60525-P-003P;
As the law firm Drinker Biddle & Reath said in a Tuesday client alert, SEC Chairman Jay Clayton noted recently that to date, no ICOs have been registered with the SEC, and the SEC has not approved any exchange-traded products holding cryptocurrencies.
As Georgetown University finance professor Jim Angel noted in a Tuesday (http://thehill.com/blogs/pundits-blog/finance/322695-approving-bitcoin-etfs-will-lead-investors-to-slaughter) op-ed for the Hill, the nature of exchange-traded funds, which only rely on their underlying assets' values and, in this case, wouldn't translate to a direct purchase of the virtual currency, would somewhat shield bitcoin from SEC investigations of its manipulation.
One innovation is the exchange-traded managed fund (ETMF), introduced early last year under the NextShares brand name.
Such automated trades occur at incredibly fast speeds that can then impact either a few or several exchange-traded securities.
Through this acquisition, Broadridge Global Post Trade Management will facilitate central clearing for exchange-traded derivatives, which encompasses connectivity to global clearing houses and exchanges through its global, multi-asset class post-trade solution.
The ETF is an investment fund traded on stock exchanges, much like stocks, while ETPs include exchange-traded funds and exchange-traded notes.
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.
says his sponsor clients are curious about exchange-traded funds (ETFs) -- but not enough to offer them as an investment.
TheStreet ratings' guide to exchange-traded funds; a quarterly compilation of investment ratings and analyses covering ETFs and other closed-end mutual funds, spring 2011.
The ETNs are the first exchange-traded products to provide investors with leveraged exposure to the USDX.