ETFs are exchange-traded funds, also known as exchange-traded open-end index funds. Some investors also call them: exchange-traded funds.

There are two trading channels for ETFs: secondary market trading and primary market redemption.

The latter is not suitable for most investors, and the first method is generally used: in layman's terms: you only need to open a stock account, and you can trade ETFs just like stocks.

: Inside is the stock market, which is what everyone calls the secondary market.

OTC refers to outside the stock trading market, which is the consignment sales of banks and securities companies, and the direct sales method of fund companies, which are the familiar open-end fund sales channels.

Open a Shanghai and Shenzhen shareholder account at a securities company, and you can conduct on-site transactions of listed open-end funds LOF and ETF funds at the securities company's business department or the securities company's website (if you have bought stocks or closed-end funds before, you already have an account

There is no need to reopen it, just use the original account).

The trading price on the market is real-time, that is, it is the price you purchased at that time, which is the same as stock trading.

Like over-the-counter subscriptions, dividends can also be distributed to funds purchased (purchased) on-exchange, but there is one difference. Dividends from funds purchased on-exchange can only be cash dividends, and dividends cannot be reinvested. For off-exchange funds, dividends can be reinvested.

Funds that can be redeemed and purchased on the market can also be redeemed on the market. The redemption price is the net value of the day announced by the company after the market closes.

Buying (stock method) and subscribing (fund method), selling and redemption are different.

Exchange-traded open-end index funds are a special type of open-end funds. They combine the operating characteristics of closed-end funds and open-end funds. Investors can not only subscribe for or redeem fund shares from the fund management company, but also

Closed-end funds also buy and sell ETF shares in the secondary market at market prices. However, subscriptions and redemptions must be made in exchange for a basket of stocks for fund shares or for fund shares to be exchanged for a basket of stocks.

Due to the simultaneous existence of secondary market transactions and subscription and redemption mechanisms, investors can conduct arbitrage transactions when there is a difference between the ETF market price and the net value of the fund unit.

The existence of the arbitrage mechanism enables ETFs to avoid the discount problem common to closed-end funds.

According to different investment methods, ETFs can be divided into index funds and actively managed funds. The vast majority of foreign ETFs are index funds.

The ETFs launched in China are also index funds.