What does fund etf mean?
The English name of ETF is ExchangeTradedFund, which translates into transactional open index fund. It can buy or redeem fund shares from fund management companies, and at the same time, it can buy and sell ETF shares at market prices in the securities market like stocks. In short, it has the advantages and characteristics of stocks, open index funds and closed index funds.
As a kind of index fund, ETF can be divided into bond ETF, currency ETF, commodity ETF and cross-border ETF besides investing in stocks. However, stock ETF is still the most common variety in the market, and further subdivision can be divided into wide base and narrow base according to the type of index.
Broad-based stocks cover a wide range of industries, such as Shanghai and Shenzhen 300ETF, CSI 500 ETFs, GEM ETFs and SSE 50ETF.
Narrow base is to focus on investing in a certain kind of index, such as related indexes of style, industry and theme, such as pharmaceutical ETF and consumer ETF.
As an investment tool, ETF has obvious characteristics. Specifically, it has the advantage of indexation, which can disperse investment risks, and its performance is basically consistent with the index, with low transaction cost, high transparency and good liquidity.
Under normal circumstances, ETF is the fund that replicates the target index to the greatest extent, and it is the first choice for many people to vote.