Abstract
Exchange-traded funds (ETFs) are portfolios of stocks that typically represent a specific index. Most ETFs are structured as mutual funds, but have the unique, distinguishing (and un-mutual-fund-like) feature of continuous pricing and trading. Independent ticker symbols for both market price and net asset value provide an unheralded degree of transparency for a portfolio-structured financial product. Owing to ETFs' features and broad appeal and applicability, particularly in the areas of hedging and asset allocation, the asset class has expanded dramatically in terms of both capital represented and number of funds—a development we expect to see continue.
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