The full name of ETF is ExchangeTradedFund, which is translated into Chinese. It is an index open-end fund listed and traded on the stock exchange, which combines the advantages of securities funds and stocks, enabling investors to invest in a variety of financial assets with minimum cost and maximum efficiency.

First, the origin and advantages of ETF

ETF was first put forward by NathanMost Monszky, a reporter from the American financial magazine InstitutionalInvestor, in 1993. At that time, it was called Exchange Investment Fund (ETIF). And in 65438+February of the same year, the world's first ETF-Standard & Poor's 500 Index Fund (SPDR) went public.

Compared with traditional mutual funds, ETF has the advantages of convenient transaction, diversified and efficient asset allocation, good flexibility and low management cost. Compared with other investment products, its return-risk ratio also has advantages.

Second, the classification of ETF.

Etfs can be divided into several categories according to asset types, investment styles and investment sectors.

1. Depending on the type of asset

At present, the common ETFs in the market are mainly divided into four categories, namely stock ETFs, bond ETFs, commodity ETFs and hybrid ETFs.

2. According to the investment style

According to the investment style, ETFs can be divided into value ETFs, growth ETFs, index ETFs, quantitative ETFs and dividend ETFs.

3. According to the investment department

Etfs can be divided into industry ETFs, regional ETFs and theme ETFs according to investment sectors.

Third, the cost and risk of ETF.

Compared with traditional fund products, the cost of ETF is very low, but similar to stocks, it needs to know and control the risks to some extent. The risk of ETF is ultimately determined by the underlying assets of the fund. If the underlying assets perform poorly, ETFs will also face corresponding risks.

At the same time, the fluctuation of the actual trading price of ETF on the trading day will also bring risks, because it is listed on the stock exchange like a stock, so the price will fluctuate under the influence of market supply and demand.

Fourthly, the investment strategy of ETF.

The most common investment strategy of ETF is passive investment. Because the essence of ETF is to track the index and minimize the deviation, its investment strategy is considered as passive investment, not active investment.

Of course, the investment strategies of ETFs are not all passive, and there are many active ETFs, but compared with passive ETFs, their management costs will be relatively high, so they still belong to the category of passive investment to a large extent.

Verb (abbreviation of verb) abstract

ETF is a good investment tool with the advantages of flexible trading, low cost and diversified asset allocation. For investors, investing in ETF needs to make corresponding investment decisions based on comprehensive factors such as market conditions and their own risk tolerance.