An Exchange Traded Fund (ETF) is an exchange-traded, index-replicating THE SPECIAL and is characterized by high liquidity, transparency and low Transaktionsgebuehren. Were the first ETFs still mainly on stock indices, such as the Dow formed, it has in the meantime, the spectrum of the underlying asset classes and commodities extended to pensions. The high liquidity of ETFs results from the ongoing liquidity of the investment instruments on the stock exchange, which are the underlying of the ETFs. About the Creation-Redemption process can now shares in an ETF over the purchase of securities or created over the sale of these securities are also back again.
The main advantage of ETFs is their low transaction costs, as no active fund management, including administrative expenses, but only one Index replication.