What does Exchange trade fund work ?

ETFs can be bought or sold at the stock exchange as mutual fund units. ETFs are different from regular mutual funds units that investors can buy or sell directly or through a distributor. The AMC is not able to deal directly with distributors or investors in the ETF structure. The Authorised Participants (APs) are a small group of large participants who receive units. The APs offer buy and sale quotes on ETFs that are listed on the stock exchange. This allows investors to purchase and sell ETFs at any time the stock market is open. ETFs trade just like stocks, and are subject to price fluctuations throughout the day. An investor must have trading and demat accounts in order to buy and sell ETFs.