Exchange Traded Products – ETP

AAA

DEFINITION of 'Exchange Traded Products – ETP'

A type of security that is derivatively-priced and which trades intra-day on a national securities exchange. Exchange Traded Products are derivatively-priced, where the value is derived from another investment instruments such as a commodity, currency, share price or interest rate. Generally, exchange traded products are benchmarked to stocks, commodities, indices or they can be actively managed funds. Exchange traded products include exchange traded funds (ETFs), exchange traded vehicles (ETVs), exchange traded notes (ETNs) and certificates.

INVESTOPEDIA EXPLAINS 'Exchange Traded Products – ETP'

The most popular exchange traded product is the exchange traded fund (ETF). These are securities that track an index, commodity or basket of assets. Exchange traded notes, on the other hand, are a type of unsecured, unsubordinated debt security. The value of an ETN can be affected by the credit rating of the issuer and not just changes in the underlying index. Exchange traded products have experienced huge growth since they were introduced. Different tax treatment applies to the various types of exchange traded products.

RELATED TERMS
  1. Exchange Traded Notes - ETN

    A type of unsecured, unsubordinated debt security that was first ...
  2. Derivative

    A security whose price is dependent upon or derived from one ...
  3. Active Management

    The use of a human element, such as a single manager, co-managers ...
  4. Exchange-Traded Fund - ETF

    A security that tracks an index, a commodity or a basket of assets ...
  5. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  6. Collateralized Loan Obligation ...

    A security backed by a pool of debt, often low-rated corporate ...
Related Articles
  1. Options & Futures

    An Introduction To Structured Products

    Learn a simple way to bring the benefits of derivatives into your portfolio.
  2. Mutual Funds & ETFs

    Going Green With Exchange Traded Funds

    As investors become more environmentally conscious, the exchange traded fund market is following.
  3. Mutual Funds & ETFs

    IMF Or ETF: Which Is Right For You?

    Here's what the professionals think about these similar, but critically different, investment vehicles.
  4. Mutual Funds & ETFs

    How To Reduce Taxes On ETF Gains

    Boost your returns by learning the tax tricks and loopholes for your exchange-traded funds.
  5. Mutual Funds & ETFs

    Exchange Traded Notes - An Alternative To ETFs

    ETNs offer yet another way to track an index. Find out what they have to offer, and what's at stake.
  6. Mutual Funds & ETFs

    Introduction To Exchange-Traded Funds

    Get into ETFs and enjoy the benefits of a mutual fund with the flexibility of a stock.
  7. Investing

    Are ETFs required to pay out a percentage of income as dividends?

    The exchange-traded fund (ETF) is a relatively new investment vehicle, hitting the market in 1993. A fund company can create ETFs when it is awarded specific exemptions from the Investment Company ...
  8. Investing

    Investing Strategies For The Millennial Generation

    Suggestions to build a long-term plan for the millennial generation, according to their needs and goals.
  9. Fundamental Analysis

    Why are OTC (over-the-counter) transactions controversial?

    Learn more about over-the-counter transactions, and why OTC traders are considered riskier than traders working with larger market exchanges.
  10. Options & Futures

    What is the difference between arbitrage and hedging?

    Dive into two very important financial concepts: arbitrage and hedging. See how each of these strategies can play a role for savvy investors.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center