What is an Index?
Technically, an index is a mathematical measure of the performance of a group of investments. Simply stated, an index tracks the growth of a basket of stocks or bonds. For example, the S&P 500 index tracks the performance of the 500 largest publicly traded firms in the United States. Though the companies in the index sometimes change, what is important to most investors is the change in value of the actual index over a period of time.

What is an ETF (Exchange-Traded Fund)?
ETFs are mutual funds traded publicly on a stock exchange. These funds can own hundreds of stock or bond positions. By purchasing shares of an ETF, you are indirectly investing in hundreds of positions without the cost or hassle of buying these positions yourself.

What is an Index-Linked ETF?
Index-linked ETF’s are created to perform exactly like a stock or bond specific index. The S&P 500 Index ETF is a basket of the actual stocks of the 500 largest companies in the United States as picked by Standard and Poor's. This ETF allows an investor to gain exposure to the S&P 500 without having to try to buy all 500 stocks individually. An index-linked ETF is a tremendously powerful investment vehicle that enables investors to quickly and efficiently invest in many companies and industries.

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