About ETFs

ETFs are just what their name implies: baskets of securities (Indices) that are traded, like individual stocks, on an exchange. Unlike regular open-end mutual funds, ETFs can be bought and sold throughout the trading day like any stock. ETFs have lower cost of transactions and annual changes compared to index funds. ETFs are considered a safer product for risk averse and first time investors who want market linked returns.

They first came into existence in the USA in 1993. It took several years for them to attract public interest. But once they did, the volumes took off with a vengeance.  

Index Tracking

Index tracking has been widely acclaimed in practice and in theory as a winning strategy for long term investing. It has been the experience that globally, a majority of actively managed funds have underperformed their respective benchmarks over a long period of time.