ETF

What is the opposite of ETF? Here is what we hold, with its meaning and related words.

Noun — An investment fund that holds a basket of assets such as shares, bonds or commodities, and whose own units are bought and sold on a stock exchange throughout the trading day like an ordinary share.

Synonyms by Meaning

1. noun

An investment fund that holds a basket of assets such as shares, bonds or commodities, and whose own units are bought and sold on a stock exchange throughout the trading day like an ordinary share.

“She moved most of her pension into a low-cost ETF that tracks the whole market.”

exchange-traded fund tracker fund fund pooled fund

2. noun

A single unit or share of such a fund, representing a small slice of everything the fund holds.

“He bought forty ETFs at just under ninety pounds each.”

fund unit share

How to use ETF

The word patterns that sound natural to a native speaker.

low-cost ETF ETF provider bond ETF ETF ticker track an index

Standard in financial writing and everyday investing talk. Almost always used as the initialism; the full form exchange-traded fund appears mainly in formal documents.

Etymology

An initialism of exchange-traded fund.

Full origin of ETF →

Frequently asked questions

What is the difference between an ETF and an index fund?

An index fund is defined by what it does: it tries to match the performance of a market index rather than pick winners. An ETF is defined by how it is traded: its units change hands on a stock exchange during the day at whatever price buyers and sellers agree. Many ETFs are index funds, but an index fund can also be a traditional mutual fund that is priced only once a day, and some ETFs follow an active strategy rather than an index.

Does an ETF mean you own the underlying shares directly?

No. You own units in the fund, and the fund owns the assets. Your unit gives you a proportional claim on the fund's holdings rather than a direct shareholding in any one company, so you do not normally get individual voting rights in those companies.

What does it mean when an ETF 'tracks' something?

It means the fund is built to move roughly in step with a named benchmark, such as a stock index or the price of a metal. The match is never exact; the small ongoing difference between the fund and its benchmark is called tracking error.

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Nearby words

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