Exchange-traded funds

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Revision as of 14:35, 7 November 2007 by ChristineNielsen (talk | contribs) (New page: {{helpAddContent}} Exchange-traded funds (ETFs) are investment companies that are legally classified as open-end companies or Unit Investment Trusts (UITs) except for a few diffe...)
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Exchange-traded funds (ETFs) are investment companies that are legally classified as open-end companies or Unit Investment Trusts (UITs) except for a few differences.

These differences include that ETFs do not sell individual shares directly to investors and only issue shares in large blocks called Creation Units.

Currently, all ETFs seek to achieve the same return as a particular market indexes. Such an ETF is similar to an index fund in that it will primarily invest in the securities of companies that are included in a selected market index. An ETF will invest in either all of the securities or a representative sample of the securities included in the index.


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