Exchange-traded fund

Exchange Traded Funds (ETFs) are bought on the stock exchange just like investment trusts or shares in any other company. ETFs mirror the performance of a particular stock market index such as the FTSE 100, usually by investing in the same shares, bonds or other assets in the same proportions as the index. However, some ETFs use more complicated processes to replicate the markets – which can mean they are riskier investments.

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