Definition:

An abbreviation for Exchange Traded Fund. It is a pooled investment vehicle made up of money from many different investors and managed by a professional money manager on their behalf to a specific investment strategy and objective. The fund may be invested in stocks, bonds, other marketable securities and even other ETFs.

It functions very much like a mutual fund. However, unlike a mutual fund which are only priced and trade once per day, an ETF is listed on an exchange with shares that trade and get priced in real-time, all day, just like a stock.

Example:

She invested in an Oil ETF from her brokerage account.

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