An ETF (Exchange-Traded Fund) is a fund traded on an exchange like stocks, comprising a portfolio of assets (stocks, bonds, commodities, indices, etc.) and allows investors to buy a share in this portfolio.
The main advantage of an ETF is diversification since buying one ETF gives you access to a variety of assets, reducing risk. ETFs also have high liquidity, as they can be bought and sold during the trading day, like stocks.
They often may have lower fees than traditional mutual funds and are suitable for both long- and short-term investments.
