ETFs are the exchange-traded funds, which are actually index funds, which are bought and sold just like stocks in the stock exchange. ETF, which is a worldwide traded fund, is a very popular investment destination for retail investors and institutional investors. We can say that this is a cheap investment instrument because the charges in this fund are generally lower than other funds. You can buy them from your broker or directly from the fund house. Where mutual funds are taken at the end of the day at the NAV, only ETF trading hours can be bought and sold at the actual prices of trading at that time. That is, day trading is also possible in the ETF.

Structure of ETF
The structure of the ETF is based on its index. Nifty or Sensex index for example.
30 stocks in the Sensex in the Sensex ETF, according to their market capitalization, will be invested as if they are important in Sensex. Similarly, Nifty ETFs are also invested in Nifty shares. Similarly, there may be Gold ETFs like industry based index such as Pharma Index, Banking Index or Mid Cap, Small Cap Index or Commodity-based ETF.

Benefits of ETF
Buy easy to sell Because stocks included in the Stock Exchange Index (Sensex or Nifty, etc.) are included in different industries, there is a diversification in the index ETF which reduces the risk of investment. ETFs are convenient, you can invest in fifty stocks of Sensex and fifty shares of Nifty together. In the same way, you can buy Gold ETF by buying real gold or gold, which is more convenient. The ETF can be invested in a small amount. You can also take SIP in the ETF.
- Prices can be monitored after the purchase of ETF like shares.
- ETFs provide information about INVESTMENTS, which makes the investment more transparent.
- ETFs can easily be sold.
- Invest in ETFs can be invested in different sectors.
- does not seem to be Income Tax (TAX) on ETF Dividend (DIVIDEND)
- There are FUND MANAGERS for every ETF so that the investor does not have to buy or sell shares.

Ease of investment with work risk
For those who do not have much information on the stock market or want to avoid taking more risk in the stock market, investing in mutual funds and ETFs is also a low-risk investor. ETF offers diversification to your investment.

Author's Bio: 

I Manisha, Market researcher highlighting the topic of "What is the Exchange Traded Funds (ETF)? " Also, we provide stock trading tips and Free Nifty Tips