An Exchange Traded Fund ETF Is traded at a fixed price in the market Cannot be used to trade commodi...........

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An Exchange Traded Fund (ETF)

Is traded at a fixed price in the market
Cannot be used to trade commodities
Must be bought over a futures contract

Select the correct answer using the codes below.

1 and 3 only

2 only

3 only

None of the above

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Explanation:

Statement 1 and 2: ETF is like a mixture of funds that is trade in the stock market. It can be based on an index, a commodity, bonds, or a basket of assets like an index fund; similar to a mutual fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. ETFs experience price changes throughout the day as they are bought and sold.

Statement 3: There is no such condition. ETFs can be easily bought / sold anytime during market hours like any other stock on the exchange. The CCEA has recently authorized taking a call on an Alternative Mechanism on divestment through Exchange Traded Fund (ETF) out of all the listed CPSEs.