Skip to Content
Opening Bell
Back to Glossary

Exchange-Traded Fund (ETF)

Market Mechanics

An ETF is an investment fund that trades on an exchange throughout the day like a single stock.

Most track an index and give you dozens or hundreds of stocks in a single trade. The fund deducts a small annual percentage of assets as its expense ratio, and leveraged and inverse ETFs, which target a daily return, can drift well away from their index over longer periods.

Related Terms

2 Links

More in the Guide