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Not investment advice. Educational reading. See Disclaimer.
L.1 · BEGINNER · 2 MIN

What Is an ETF?

An ETF (Exchange-Traded Fund) is a basket of securities that trades on an exchange like a stock. One share gives you instant diversification across dozens or thousands of companies.

Quiz · 5 questions ↓
§ 01
ETFMutual FundIndividual Stock
DiversificationHigh (one share = many stocks)HighNone (one company)
TradingAll day at market pricesOnce per day at NAVAll day
FeesVery low (0.03-0.75%)Higher (0.5-2.0%)None (just commissions)
Tax efficiencyHigh (in-kind creation)Lower (capital gains distributions)You control timing
§ 02

The three most popular ETFs: SPY (S&P 500), QQQ (Nasdaq 100), VTI (total US market). Together they hold trillions in assets.

§ 03
Look up **SPY** and notice how the platform shows holdings, sector breakdown, and expense ratio. This data is unique to ETFs.
§ 04

For most investors, a low-cost broad market ETF like VTI is the single best investment vehicle. It gives you the entire US stock market for 0.03% per year.

§ 05
An ETF and a mutual fund both track the S&P 500. What's the MAJOR operational difference?
Five questions · AI feedback

Sit with the ideas.

What is a key advantage of ETFs over mutual funds?

Why:
Try this in paper trading

Build a 3-ETF starter portfolio

Allocate $25,000 of your paper cash across three ETFs: a broad-market index (e.g., VTI or SPY), an international fund (e.g., VXUS), and a bond fund (e.g., BND or AGG). Pick the weights you'd actually hold for the next decade.

Open paper portfolio →

Practice mode — simulated trades, not investment advice.

See it on a real ticker →