Traded open-end index funds, also commonly known as Exchange Traded Funds ("ETF" for short), are a type of fund listed and traded on an exchange with variable fund shares. An open-end fund.

Generally speaking, the threshold for direct subscription from a fund management company is relatively high, usually starting at 500,000 shares. It should be noted that ETFs are purchased and redeemed in kind. Investors use a basket of stocks, that is, all the constituent stocks included in the index, to subscribe; when redeeming, they also get a basket of stocks. Only when one of the constituent stocks is suspended from trading can a small amount of cash be used to replace the stock.

ETF funds: ETF funds track a certain index. For example, the SSE 50eft tracks the SSE 50 Index and completely replicates the constituent stocks of the SSE 50. Therefore, it is a completely passive investment method. Extended information

The objects of subscription and redemption are different.

ETF funds: adopt "physical subscription and physical redemption". Investors subscribe for a basket of stocks and redeem a basket of stocks.

LOF Fund: The fund may subscribe for a basket of stocks, but the redemption is in cash.