ETF shares have different kinds. The following are:

• Index ETF

A lot of ETFs are under this type. Index ETFs grip securities and try to reproduce the stock market index’s presentation. When hunting for the presentation track of a stock market index, you have to get a hold of its contents and illustrations through its portfolio. Leveraged ETF is one type of the index ETF and it is also called as the inverse ETF. This type uses the unoriginal investments to be able to get the one similar or opposite of the everyday presentation of the index. A lot of ETFs under this type have 100% investment from the assets of the investors. This is called the “replication”. If only 80% up to 95% of the assets are invested then it is called as the “representative sampling”. The remainders of their investments are used for underlying index securities, futures, swap and option agreements. Investing only a small amount is also called as “aggressive sampling”.

• Commodity ETFs

In this type, the investments are the likes of expensive futures and metals.  The first ever commodity ETF were gold exchange-traded funds which were also scattered in different countries. The Gold Bullion Securities were the first once to use the gold exchange-traded fund and opened it in 2003. The difference between commodity ETFs and index ETFs is that commodity ETFs follow non-securities indexes. Commodity ETFs are subject for the approval of the Commodity Futures Trading Commission since they do not do investments in securities.
On the other hand, the ETCs or the Exchange Traded Commodities are completely collaterized assets that follow the presentation of the core commodity index. They are similar with ETFs in a way because they are also put on trade and are developed like general ETF shares with their sole bestowed section.

• Currency ETF

The first currency ETF was started by the Rydex Investments back in 2005 and they called it the Euro Currency Trust that can be found in New York. After the launch of Rydex, several funds have started to come out in the market.

• Bond ETF

iShares Barclays is an example of Bond ETFs which puts their investment in U.S. government bonds. During these hard economic times, they boom because instead of putting their cash in the stock market, they pull it out and put it in the U.S. Treasuries. Bond ETFs are the indication that there is really a vast amount of people who are experiencing recession. One of the benefits that can be gained with Bond ETF is the practical trading commission that they put up. The downside to this is it can actually be a disadvantage if and when the trading costs are purchased and put on sale by a third person.

• Actively-managed ETF

This type was just launched in 2008 and they ones approved today are completely transparent and they update their portfolios through the Internet daily.

• Other types are:

•    Leveraged ETF
•    Hedge Fund ETF
•    Exchange-traded grantor trusts

ETF shares reap different benefits and advantages and each share is different from the other. The most important thing to remember is to choose your investments wisely by gathering more information through professionals or through the Internet.

If you’re interested in learning more about Exchange Traded Funds, we recommend this free ETF Trend Trading Newsletter. You can get the newsletter online instantly and it will answer a lot of your questions.