About: Exchange Traded Funds (ETFs) - Jobersite

Thursday, June 11, 2020

About: Exchange Traded Funds (ETFs)

About: Exchange Traded Funds (ETFs)


An exchange-traded fund can be seen as a basket of underlying assets, such as shares, bonds, commodities and indices, that are pooled together into a single entity.
It divides ownership of these assets into shares, which are later sold on the open market. Each share of an ETF gives its owner a proportional stake in the total assets of the fund.
Briefly, Exchange Traded Funds (ETFs) are like mutual funds listed and traded on stock exchanges like shares.
Usually, ETFs are passive funds where the fund manager doesn’t select stocks on your behalf. Instead, the ETF simply copies an index and endeavours to accurately reflect its performance.
In an ETF, one can buy and sell units at prevailing market price on a real time basis during market hours.
The ETFs trading value is based on the net asset value of the underlying stocks that it represents.
ETFs are offered on virtually all asset classes ranging from traditional investments to alternative assets like commodities or currencies.
About: Gold backed Exchange Traded Funds (ETFs)
A gold ETF, or exchange-traded fund, is a commodity ETF that consists of only one principal asset i.e. gold.
Gold-backed ETFs and similar funds allow investors to generally track the price of gold, giving them access to the properties and security of owning physical gold without the need to arrange for storage and insurance separately.
Note: If one buys shares in a gold ETFhe/she do not actually own any physical gold. @MrunalsEconomy