Types of ETFs

ETFs are created to track the performance of different indexes or sectors, and depending on the sector, underlying assets, and investment strategies, ETFs can be divided into the following types:

1. Equity ETFs: ETFs that invest in the equity of the companies listed on a stock exchange are Equity ETFs. Such ETFs track the performance of different industry sectors, geographic regions, and market capitalization like small-cap, mid-cap, and large-cap.

2. Fixed Income ETFs: These types of ETFs are focused on all types of fixed-income-yielding securities, like bonds and debentures. It invests in all categories of bonds, including government bonds, corporate bonds, treasury bonds, municipal bonds, and agency bonds.

3. Commodity ETFs: These ETFs invest in physical commodities like gold, silver, oil, or agricultural products or invest in companies involved in their production, exploration, or distribution, with an aim to track the price movements of the underlying commodity. Commodity ETFs provide diversification or a hedge against inflation or other economic condition.

4. Currency ETFs: Currency ETFs invest and focus on currencies of different countries or a bunch of currencies, allowing the investor to enter the foreign exchange market. Such ETFs track the performance of specific currencies, or specific currency pairs, or provide exposure to a basket of currencies.

5. Real Estate ETFs: Real Estate ETFs invest in real estate properties, or in real estate investment trusts (REITs) or real estate operating companies (REOCs), that own, operate, or finance income-generating real estate properties. These ETFs allow investors to gain exposure to the real estate market, and track the performance of specific types of properties, such as residential, commercial, or industrial real estate. 

6. Factor ETFs: Factor ETFs aim to focus on different investment factors like value, financial goal, risk management, timeline, growth, etc. to gain exposure to specific investment strategies.

7. Multi-Asset ETFs: Multi-Asset ETFs invest in a diversified portfolio consisting of assets of different classes bound together in a bunch, so as to enjoy the benefits of a diversified investment approach in a single fund.

8. Sector ETFs: ETFs that invest in specific sectors or industries, such as technology, healthcare, finance, energy, renewable energy, artificial intelligence, or consumer goods are Sector ETFs. These aim to track the performance of specific sectors or industries to implement a sector rotation strategy or get a specific investment view. 

The above-mentioned ETFs are some out of the pool of ETFs. It is important to analyze each type of ETF before making investment decisions and to determine the type of ETF that is confined to the investment goals and risk tolerance of an investor.