An ETF, or Exchange-Traded Fund, is a type of investment fund that trades on stock exchanges, similar to individual stocks. ETFs are designed to track the performance of a specific index, commodity, or asset class, such as stocks, bonds, or commodities. They offer investors a way to gain exposure to a diversified portfolio of assets without having to buy each security individually. ETFs are popular among investors for several reasons. First, they provide diversification, allowing investors to spread their investment across a basket of assets, which can help reduce risk. Second, ETFs typically have lower fees compared to actively managed mutual funds. Third, ETFs offer liquidity, as they can be bought and sold throughout the trading day at market prices. There are different types of ETFs available to investors, including equity ETFs, bond ETFs, commodity ETFs, and sector ETFs, among others. Each type of ETF is designed to track the performance of its underlying index or asset class. Overall, ETFs offer investors a convenient and cost-effective way to gain exposure to a wide range of investment opportunities, making them a popular choice for both individual and institutional investors alike.