How to Trade ETFs
The term “ETFs” is short for exchange-traded funds. An ETF is simply an agreement between investors, called investors in a mutual fund. An ETF usually will have a fixed and/or floating period within which to sell or buy securities. ETFs also allow investors who buy securities directly to trade in the same manner as with a direct mutual fund.
Investors can trade ETFs much like they trade individual securities, via a brokerage account. Investors can buy and sell their desired positions during the trading day and at the end of the trading day, if they so desire. When an investor trades an ETF, the transaction costs are the same as with a direct purchase and/or sale of the underlying securities.
In addition, when an investor trades an ETF, the brokerage account does not bear any mark-up, as with other securities, since the trading day is the only time that fees …