What Are ETFs (Exchange Traded Funds)? Explained in Simple Words Author: @nkit ETFs, or Exchange Traded Funds, are becoming very popular among beginners and long-term investors. Many people say ETFs are a mix of stocks and mutual funds. In this blog, we will understand what ETFs are, how they work, and why they are useful for common investors. What Is an ETF? ETF stands for Exchange Traded Fund . An ETF is an investment fund that holds a collection of assets such as stocks, bonds, or commodities and is traded on the stock exchange just like a normal share. When you buy one unit of an ETF, you indirectly invest in many companies or assets at the same time. How Do ETFs Work? ETFs track an index, sector, commodity, or asset. For example: Nifty 50 ETF tracks the Nifty 50 index Bank ETF tracks banking sector stocks Gold ETF tracks the price of gold ETFs are bought and sold on the stock exchange during market hours, and their prices change throug...