An Exchange-Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like individual stocks. ETFs hold a collection of assets, such as stocks, bonds, or commodities, and they aim to track the performance of a specific index or sector. This allows investors to gain exposure to a diversified portfolio without having to buy each asset individually. ETFs are popular among investors due to their flexibility, liquidity, and lower expense ratios compared to traditional mutual funds. They can be bought and sold throughout the trading day, making them an attractive option for both short-term and long-term investment strategies.