ETF

ETF is an acronym that stands for Exchange Traded Fund. ETFs replicate the performance of a benchmark, i.e. a reference index containing various financial securities, by reproducing its performance. By definition, each ETF is passively managed because it attempts to faithfully reproduce the value of the benchmark index simply by holding the underlying financial products, or derivative contracts. By contrast, a traditional investment fund seeks to outperform the reference index by actively trading securities in the market. Compared to index funds, ETFs have lower costs and management fees, but require the payment of a commission to an intermediary for each transaction made.

ETFs fall under the classification of ETPs (Exchange Traded Products), a category that also includes ETNs (Exchange Traded Notes) and ETCs (Exchange Traded Commodities). Although they are all part of the category of financial instruments that replicate the performance of a reference index, ETNs and ETCs are not funds but debt instruments. Exchange Traded Commodities, specifically, replicate the performance of commodities (including, for example, gold or silver).

Investing in ETFs means diversifying your portfolio, i.e. automatically distributing your capital among different securities and/or market sectors, thus reducing risk. An ETF portfolio can include bond ETFs, which by definition replicate the performance of bond indices, equity ETFs, which benchmark equities, and commodity or real estate ETFs.

Bitcoin ETFs are funds that replicate the performance of BTC. By investing in this type of ETF, investors can take advantage of Bitcoin’s trend, without buying it directly: there is therefore no need to open a wallet or rely on crypto exchanges.

Choosing a BTC ETF also means more security from a legal point of view, as these financial products are more thoroughly regulated than cryptocurrencies in general. In states where it is illegal to hold cryptocurrencies, investing in Bitcoin ETFs could allow investors to gain exposure to BTC without violating any regulations. 

Correlated words

Mutual Funds

Mutual funds are financial instruments that combine the capital of several investors into a single asset.

Bear Trap

A Bear Trap is a bearish movement in a bullish market that confuses investors.

Bull Trap

A bull trap is a short bullish movement in a bearish market which can mislead people just like a trap.

Volatility

In economics, volatility indicates the variation of the price of a financial instrument through time.

Supply and demand

In economics, supply and demand correspond to the two main market variables and describe the behaviour of those who buy and sell goods or services.

Volume

The amount of currency traded in a given period.

Market Trend

A perceived tendency of financial markets to move in a particular direction over time.

Trading

Trading is a speculative activity of buying and selling financial assets, with the goal of making a profit.

Stop Order

A trading order that allows you to set a price at which another order is triggered.

Slippage

The difference between the execution price of an order and the price entered in the order.

Support and resistance

Support and resistance are two technical analysis tools used to monitor the price trend of an asset.

ROI

A value that measures the return generated by an investment.

Pump&Dump

A strategy that inflates the price of a cryptocurrency to generate profits only for those who implement it.

Prediction Market

Exchange-traded markets created for the purpose of trading the outcome of events.

Order Book

The list of all the prices at which traders are willing to trade a certain amount of cryptocurrency on an exchange.

Oracle

A service that collects data not available on blockchain, verifies it and provides it to smart contracts

Moon

When the price of a cryptocurrency rises very fast, they say it soars 'to the moon'.

Market Order

Instant buy or sell at the next best price available on the market.

Market Maker

Companies or organised entities that, in partnership with an exchange, are always willing to buy and sell a cryptocurrency.

Market Cap

The total value of all the coins or tokens of a cryptocurrency in circulation.

Limit Order

A buy or sell order that is executed only when the cryptocurrency reaches the set price.

Futures Contract

A contract that regulates the execution of a transaction at a predetermined price on a specific date.

FUD

Fear, Uncertainty and Doubt refers to a negative market sentiment

Circulating Supply

The number of units of a cryptocurrency available on the market.

Forex

The Foreign Exchange Market allows fiat currency trading.

FOMO

Fear Of Missing Out is an expression often used in the context of trading and cryptocurrencies.

Buy Wall and Sell Wall

High number of purchases or sales demanded at a certain price.

Bull Market

A market where there is an upward price trend

Break-Even point

The balance point between losses and gains, income and expenditure.

Bid and Ask

Supply and demand on a cryptocurrency exchange.

Benchmark

A standard for measuring the performance of a financial instrument or market.

Bear Market

A market phase characterised by price lows.

ATH and ATL

Acronyms used to indicate the maximum and minimum price of a cryptocurrency.

Download the Young Platform app

Downaload From Google PlayStoreDownaload From Apple Store