Types of ETFs
There are a variety of Exchange Traded Funds (ETFs) that provide investors an opportunity to develop a diversified investment portfolio. ETF sponsors are constantly adding to the types of ETFs available, providing investors with more choice. Many ETFs track the performance of an underlying index or benchmark. The underlying index or benchmark may be broad, or sector-specific, or be linked to commodities or currencies. ETFs have evolved, however, to include those that do not passively track an underlying index or benchmark.
ETFs can be grouped into different categories, which may include: Index ETFs, Inverse and Leveraged ETFs, Commodity ETFs, Currency ETFs and Actively managed ETFs and Exchange Traded Notes (ETNs).
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