Below I define 7 different types of ETFs and explain each ETF meaning. Take a look at each one to expand your knowledge on how each one of them could fit into your investment portfolio and hopefully you gain some new ideas.
Equity ETFs track a particular set of related stocks. It can be ETFs covering large businesses, small businesses, or stocks from a specific country. Keep in mind the goal of an equity ETF is to mirror an underlying index, not outperform it.
What is an Equity ETF
Bond ETFs give investors exposure to the bond market. You can find broad market bond ETFs that cover the entire market, or bond sector ETFs that focus on particular types of bonds. This includes Treasury bonds, corporate debt, or international sovereign obligations of foreign nations. These are low risk investments.
Bond and Fixed Income ETF
Sector Industry ETF
Sector or industry ETFs let you invest in stocks within a particular sector/ industry of the market. These ETFs allow investors to gain exposure to a certain market sector, such as consumer staples or technology, rather than holding a single stock. Learn how to target sectors and how they behave.