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Which of the Following Statements Is INCORRECT About Exchange-Traded Funds

Question 3

Multiple Choice

Which of the following statements is INCORRECT about exchange-traded funds (ETFs) ?


A) ETFs are securities giving the holder fractional ownership rights over a basket of securities.
B) ETFs trade on exchanges continuously during trading hours.
C) ETF trades require brokerage commissions.
D) ETF shares cannot be shorted.
E) Arbitrage helps to ensure that an ETF's price will not move too far from its net asset value.

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