Generated on 2014/06/19 at 04:58:10 AM


Type List | Item List

Instrument Item: Exchange Traded Fund



Acronym or Abbreviation ETF
Alias or Synonym
Key Words
Description (HTML) Exchange traded funds are "baskets" of assets with varying values which are bought and sold daily on an exchange at a price which reflects the average price of the underlying assets. The most widely-traded ETFs are the market index funds, which reflect average prices on the S&P 500 and other equity indices. With their diversified portfolios, ETFs can be less risky than a single corporate stock. Because not all the assets in an ETF move in tandem, the losses in one asset may be offset by the profit in another.

In recent times a number of new and innovative ETFs have been introduced which allow trading in foreign currencies (forex), precious metals and emerging markets. ETFs in all categories have enjoyed a surge in popularity, and according to data cited in mid-December 2010, total ETF and ETF product sales amounted to over $1 trillion.

ETFs may be traded through retail brokerage firms with a schedule of competitively-priced commissions paid by the speculator. Major ETFs provide good liquidity, and therefore good price discovery - high trading volume means you can sell your position easily and take your money out with no hassle. High trading volume also mostly eliminates erratic price jumps and drops, thus minimizing downside impact when a large position is sold.

Source Description Investopedia
Source URL http://www.investopedia.com/articles/exchangetradedfunds/11/speculating-with-etfs.asp
Document No document attached...
Lifecycle - Exist Start Date UNKNOWN
Lifecycle - Exist End Date UNKNOWN
Item Quality Status (Item Quality Status) Acceptable
Updated by webea.09
Updated on 2014-05-10 22:45:34
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