You buy ETFs from an investment dealer through a full-service or online trading platform. Here’s how it works:
- You can buy or sell ETFs any time the stock market is open. ETFs are traded throughout the day at the current market price.
- ETFs have ticker symbols, just like stocks.
- There is no minimum investment amount.
- An ETF’s market price during the day will usually not be the same as its net asset value (NAV) because of changes in the underlying prices of the ETF’s assets and the demand for the ETF throughout the day. However, at the end of the day, an ETF’s market price should be close to its NAV. If the NAV and market price are very different at the end of the day (when NAV is updated), this could be a sign that the ETF is less liquid than those with market prices close to their NAV.
- ETFs are bought and sold like stocks and, investors may pay a trading fee (commission) to buy and sell them. These fees vary depending on the dealer and the type of account you have.
ETFs trade like stocks. You need to open a trading account with a full-service or online investment dealer to trade them. You can open a full-service brokerage account where an advisor gives you advice and makes trades on your behalf, or a discount brokerage account, where you do the buying and selling yourself without advice. Learn more about trading ETFs.