An Exchange-Traded Fund (ETF) is an investment fund that holds a collection of assets, such as stocks, bonds, commodities, or a combination thereof. ETFs are traded on stock exchanges, just like individual stocks, and their prices fluctuate throughout the trading day as they are bought and sold by investors. Here's how ETFs differ from mutual funds:

1. Trading Mechanism:

   • ETFs: ETFs trade on stock exchanges, meaning investors can buy and sell shares of an ETF throughout the trading day at market prices determined by supply and demand.
   • Mutual Funds: Mutual funds are bought and sold directly from the fund company at the end of the trading day at the fund's net asset value (NAV), which is calculated based on the value of the fund's underlying securities.

2. Intraday Trading:

   • ETFs: ETFs can be bought and sold intraday at market prices, allowing investors to react quickly to market movements and implement trading strategies throughout the day.
   • Mutual Funds: Mutual funds are only