exchange-traded fund (ETF)

A pooled investment vehicle with shares that can be bought or sold throughout the day on a stock exchange at a market-determined price. In most cases, an ETF is index-based—designed to track the performance of a specified index or, in some cases, a multiple, an inverse or a multiple inverse of its index (commonly referred to as leveraged or inverse ETFs). Actively managed ETFs, which do not seek to track the return of a particular index, have been available to investors since 2008.