An exchange-traded fund (ETF) is a type of investment vehicle that tracks the performance of a specific market index, such as the S&P 500, or a particular asset class, such as gold or real estate. ETFs are bought and sold on a stock exchange, and they are traded in a similar way to stocks. One of the main benefits of ETFs is that they offer investors exposure to a diversified portfolio of assets in a single investment, which can help to spread risk and manage volatility. ETFs also tend to have lower fees than mutual funds, which makes them an attractive option for cost-conscious investors. There are many different types of ETFs available, ranging from those that track broad-based indices to those that focus on specific sectors or geographic regions.