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1.
Like mutual funds, exchange-traded funds invest in _______.
All of the above. Though they have other differences, both investments have exposure to the same types of assets and sectors (though ETFs have more exposure to niche sectors).
2.
If you want to buy or sell into an exchange-traded fund, you can do so with the fund itself, like with a mutual fund.
False. Exchange-traded funds are different in this respect. You must do your trading with other investors, not the fund itself.
3.
Which statement below is true?
Exchange-traded funds offer investors a way to invest in a corner of the market without having to load up on just one or two individual stocks. As such, investors find them helpful for gaining limited exposure there.
4.
Most exchange-traded funds are index funds.
True. This fact has many advantages for investors who want to minimize capital gains, as index funds rarely sell their holdings.
5.
Can exchange-traded funds be good choices for investors who are looking for core stock exposure?
Yes, because there are several inexpensive, broad market ETFs that track major large-cap indexes.
