What are EFT‘s?
**Exchange-Traded Funds (ETFs):**
1. **Trading on Stock Exchanges:** ETFs are bought and sold on stock exchanges, like individual stocks. This allows for real-time trading throughout the trading day.
2. **Diversification:** Like mutual funds, ETFs hold a diversified portfolio of assets, such as stocks, bonds, or commodities. They often track a specific index (e.g., S&P 500).
3. **Lower Fees:** ETFs generally have lower expense ratios compared to mutual funds because they are often passively managed (tracking an index) rather than actively managed.
4. **Liquidity:** ETFs offer high liquidity, as they can be traded any time the stock market is open.
5. **Transparency:** Most ETFs disclose their holdings daily, allowing investors to see what assets are in the fund.
ETFs provide an easy and cost-effective way to invest in a diversified portfolio and can be suitable for various investment strategies, including long-term growth, income generation, and risk
