ETF is the abbreviation of ExchangeTradedFund, and it is an investment tool. It is a fund that invests in stocks, bonds, commodities and other assets, and can be listed and traded on the exchange. ETF originated in the United States, and after years of development, it has become one of the important investment tools for global investors.

Structure of ETF

The structure of ETF is relatively simple, similar to * * * and fund. ETF tracks the index changes by buying a basket of assets. ETFs are usually issued by management companies, which provide market transactions according to the liquidity of the exchange and stock or cash transactions according to the liquidity of the market. For investors, ETFs, like stocks, can be listed and traded on exchanges.

The difference between ETF and stock

Although ETF is similar to stock, it is very different from stock. ETF has more trading methods, more varieties and more complexity. At the same time, ETF trading and investment also need more professional technology and knowledge. Compared with stocks, ETF has the advantages of diversified investment, low cost, easy transaction and more tax-free income. ETF is more flexible in asset allocation and risk hedging, and ETF also has higher liquidity and transaction efficiency.

Development course of ETF

ETF originated in the early 1990s and was issued by iShares Company in the United States on 1993. With the popularity of ETF and the increasing number of investors, the development of ETF is becoming more and more mature. At present, ETF has been widely promoted and applied outside the United States, playing an increasingly important role in asset allocation and risk hedging. ETF also appears in different forms in different regions. In Asia, especially in China, ETF, as a new investment tool, has entered the field of vision of ordinary investors and been hotly debated in the market.

Application scenarios of ETF

ETF has a wide range of application scenarios, which can be used in stock market, bond market, commodity market and other fields. At the same time, ETF can also trade with other commodities to obtain better hedging effect. For example, ETF can trade with futures to achieve better futures hedging.

Generally speaking, ETF, as a new investment tool, has many advantages, which can help investors diversify assets, reduce risks and improve asset allocation efficiency. For ordinary investors, ETF, as a new investment choice, needs more understanding and learning, as well as more cautious investment methods and risk control capabilities.