Index Tracking ETF Fund - Definition and ETF Research Reports

Index Tracking ETF Fund - Definition and ETF Research Reports

Last Updated by WikiWealth

Exchange Traded Fund (ETF) Tracking Index Definition (click here to see the ETF research report database)

An exchange traded index fund is comprised of a portfolio of stocks that is meant to track the performance of a specific index, which could be the stock market or a particular sector of the general market. An index fund is designed to provide exposure to a wide variety of stocks, such as the 500 companies that comprise of the S&P 500. They variety of stocks helps to increase diversification and lower risks for investors. Other advantages include low operating expenses and low portfolio turnover.

Most ETF funds track a benchmark, which tells an investor the returns they are suppose to achieve. If the index were to increase by 1%, an investor would expect the ETF fund to increase by a similar amount. Mutual funds often use an index to measure their performance. Below is a list of the most widely followed indexes.

Exchange Traded Fund (ETF) Fund Research Reports Organized by the Index They Track