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What are ETF index funds?

Index ETFs are exchange-traded funds that seek to track a benchmark index like the S&P 500 as closely as possible. They are like index mutual funds, but where mutual fund shares can be redeemed at one price each day, the closing net asset value (NAV), index ETFs can be bought and sold throughout the day on a major exchange.

Is an ETF an index fund?

An ETF is an index fund that trades all day, like a stock. An index fund, by contrast, trades only once, at the end of the day.

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