Traded open-end index funds, also commonly known as exchange-traded stock funds, are open-end funds sold and traded on exchanges with variable fund subscriptions.

Traded open-end index funds are a unique type of open-end funds. They combine the operating characteristics of closed funds and open-end funds. Investors can subscribe or redeem from equity investment funds. At the same time, shares can be traded in the secondary market based on price trends like a closed fund. However, subscriptions and redemptions must be made by a basket of stocks to be subscribed by the fund or by exchanging the fund subscription for a basket of stocks. Basket stocks. Because there is a secondary market transaction and subscription and redemption mechanism at the same time, investors can carry out futures arbitrage when there is a price difference between the price trend and the net value of the fund unit. The existence of the hedging arbitrage mechanism avoids the discount rate problem that is common in closed funds.

Traded open-end index funds are essentially index funds, but unlike traditional index funds, traded open-end index funds can be sold on trading centers, allowing investors to trade like stocks. Trading in this way means a fund with a "underlying index value". The exchange-traded open-end index fund is a unique open-end fund that absorbs the advantages of closed funds that can be traded instantly on the same day. Investors can trade open-end funds in the secondary market just like trading closed funds or individual stocks. Index fund subscription; it also has the advantage that open funds can be subscribed and redeemed at will. Investors can subscribe to or redeem traded open index funds from equity investment fund companies just like trading open funds.

The subscription and redemption of exchange-traded open-end index funds must be subscribed by the fund with a basket of stocks or exchanged for a basket of stocks with the fund subscription. Because of this unique product subscription and redemption mechanism, investors can carry out futures arbitrage when there is a price difference between the secondary market transaction price of exchange-traded index funds and the net value of the fund unit. In addition, the price trend of exchange-traded open-end index funds is basically consistent with the net value of the fund, and the discount rate problem that is common in closed funds will not occur.