What Are ETFs? ETFs Explained At CAPEX.com

So, what are ETFs? The ETF definition may differ slightly depending on where you look. However, we can assure you that one thing is certain; an ETF is a basket of securities. Furthermore, it trades just like a stock does on an exchange. Thus, you’ll find that it has a price which can be followed throughout the day. The price of an ETF will change on a constant basis as it is bought and sold. The marketable aspect of ETFs allows you to follow the changes in price with ease. Plus, you’ll come to find that we have streamlined our latest trading platform which makes this practice even easier.

Types of exchange-traded funds

What are ETFs? There are a range of ETFs that you’ll be exposed to online. These types of exchange-traded funds have been outlined below. This adds to our ETF definition and provides you with an overview of some of the ETFs you’ll be able to trade if you use our trading platform at CAPEX.

The latest ETFs explained include bond, currency, commodity, industry, and inverse ETFs. You can trade bond ETFs which include municipal bonds, corporate bonds, and government bonds. Currency ETFs will enable you to trade foreign currency while industry ETFs will allow you to keep your pulse on an industry such as energy.

You can access exciting ETFs on the CAPEX platform such as the United States Oil Fund LP and the SPDR S&P 500. You’ll also be provided with news, forecasting tools, and analysis charts as you navigate the ETF market.

There are a number of benefits that come with trading exchange-traded funds. You’ll quickly come to find that ETFs have overtaken mutual funds in the minds of many online traders. The continued rise in popularity can be attributed to several of the points outlined below.

Low fees

When it comes to trading ETFs, you’ll find that there are far lower broker fees across the board. Plus, expense ratios are on the low side in comparison to trading mutual funds. At CAPEX, we have ensured that there are no commission rates on deposits and withdrawals – allowing you to freely trade ETF CFDs without being bogged down by unreasonable pricing policies.

Ability to diversify

The entire idea behind trading ETFs is that it provides you with exposure to multiple industries and a number of stocks. This enables you to diversify your holdings as opposed to trading in one particular stock option or market segment. ETFs have the inherent characteristic of being able to track a far wider set of stocks. You’ll find that you can trade ETF CFDs such as FAS, SQQQ, SPY and USO.

Trade ETFs like a stock

As we’ve alluded to, you’ll be able to trade ETFs much like you trade a single stock. So, you have the benefit of being able to diversify your holdings while also having the option of increased liquidity. With the real-time updates here at CAPEX, you can track price changes in all of our ETF CFD options. You’ll also be able to purchase ETFs on margin via the CAPEX platform.

If you want to know more about the similarities and differences between CFD and ETFs, we have you covered with our guide on CFD vs ETFs.

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