ETFs

ETFs, or Exchange-Traded Funds, are investment funds that are traded on stock exchanges, much like individual stocks. An ETF holds a collection of assets, which can include stocks, bonds, commodities, or other securities and is designed to track the performance of a specific index, sector, or asset class. Investors can buy and sell shares of an ETF throughout the trading day at market prices, which can fluctuate based on supply and demand.ETFs provide diversification, as they typically contain a wide range of assets, allowing investors to gain exposure to a broad market or specific sectors without needing to purchase each individual security. They also tend to have lower expense ratios compared to mutual funds, making them cost-effective investment options. Additionally, ETFs can offer tax efficiency due to their unique structure, making them appealing for both individual and institutional investors.