ETF
A fund whose shares trade on a stock exchange through the day, so its price moves continuously rather than being struck once a day the way a mutual fund's is. ETF is short for exchange-traded fund.
An ETF is a wrapper, not a strategy. Inside, it can hold a broad stock index, a bond index, one industry, or a portfolio someone actively selects. What makes it an ETF is how it changes hands: on an exchange, at a price that moves all day, in the way a share does.
Large institutions can create and redeem ETF shares in blocks by handing over or receiving the underlying holdings. That mechanism keeps the market price close to the value of the assets inside. In the United States it is also why most ETFs pass on fewer taxable gains than an equivalent mutual fund, since a redemption settled in securities rather than in cash realises little gain inside the fund, and that saving shows up only in a taxable account.
The mistake is treating all-day trading as a feature to use. Selling at eleven in the morning matters to a trader and does nothing for someone holding for twenty years, and every trade pays the gap between the bid and the ask. That gap is widest on thinly traded funds, whose price can also drift from the value of their holdings, and none of it shows up in the expense ratio.