Exchange Traded Fund (ETF) is a type of investment fund and exchange traded product that tracks the performance of an index or a “basket” of securities (such as shares, bonds, commodities, etc.).

Why trade exchange-traded funds (ETFs)?

ETFs combine the ease of stock trading with potential diversification. They are baskets of stocks and bonds, many of which are built to track well-known market indexes like the S&P 500®.

Diversification

Professional money managers do the research, pick the investments, and monitor the performance of the fund.

Zero Commissions

At $0 per trade,3 they’re usually less expensive than other baskets of investments such as mutual funds.

Flexibility

Because they’re traded on major exchanges, they’re typically as easy as stocks to buy and sell.