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What is an ETF?

An ETF, or exchange traded fund, is a security that tracks an index, a commodity, a set of bonds, or a basket of assets. ETFs blend together aspects of mutual funds and conventional stocks. Like mutual funds, ETFs are pooled investment funds that offer investors an interest in professionally managed and diversified portfolios of investments. But unlike mutual funds, ETF shares trade like stocks on stock exchanges and can be bought or sold throughout the trading day at fluctuating prices.

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