When an investor purchases shares in an exchange traded fund (ETF), he or she is interacting directly with the fund.

Question

Quizplus · Accepted Answer

When an investor purchases shares in an ETF, he or she is typically buying them from a broker on a stock exchange, not directly from the fund itself. The fund's managers create or redeem shares as needed to meet investor demand, but this occurs behind the scenes and does not involve direct interaction with individual investors.

When an Investor Purchases Shares in an Exchange Traded Fund