An ETF (exchange-traded fund) holds a basket - an index, gold, bonds - and trades on exchange like a stock, with live prices through the day (unlike mutual funds' once-daily NAV).
Costs run far below active funds, but check tracking error (does it mirror its target?) and liquidity (can you exit at fair spreads?).
Example
One Nifty 50 ETF unit gives you all fifty large-caps for under 0.1% yearly - diversification that once needed lakhs and a broker's patience.
In Ticker Screener
ETFs sit naturally in watchlists and the tape: track GoldBeES beside GLD, or Nifty ETFs beside the index, with alerts on each.
Frequently asked questions
ETF vs mutual fund - which is better?
ETFs win on cost and intraday liquidity; index mutual funds win on SIP automation. Many investors hold both.
Related terms
Index
A rule-based basket measuring a market slice - Nifty 50, S&P 500, gold prices. The benchmark everything gets judged against.
Expense Ratio
A fund's yearly fee as % of assets. A 1% fee silently eats a quarter of long-run gains - minimise it.
Market Cap
Price times shares outstanding: the market's price tag for the whole company. Defines large, mid and small caps.
P/E, ROCE, ROE, P/B, dividend yield and market cap — live beside every price in your watchlist.