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I am not very well versed in terms of ETF regulations, but I was wondering if ETF's can reweigh the assets of which they are composed of.

Lets say an ETF tracks 5 stocks and when the ETF is launched the weights are 20% each. But after a year one of the stocks has very volatile performance. In order to mitigate the risk associated with that particular stock, can it receive a lower weight in the fund while the others get more? Or are ETF's fixed from their inception to their de-listing?

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They can rebalance and often times at a random manager's discretion. ETF's are just funds, and funds all have their own conditions, read the prospectus, thats the only source of truth.

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Can they change the weights? Yes. Will they? It depends.

are ETF's fixed from their inception to their de-listing?

It's actually not possible for weights to be fixed, since different assets have different returns. So the weights are constantly changing as long as the market is moving. Usually after a certain period or a substantial market move, fund managers would rebalance and bring the weights back to a certain target.

The target weights - what your question is really about - aren't necessarily the same as the initial weights, but often times they are. It depends on the objective of the ETF (which is stated in prospectus). In your example, if the manager drops the weight of the most volatile one, the returns of the ETF and the 5 stocks could be substantially different in the next period. This is not desirable when the ETFs objective is to track performance of those 5 stocks.

Most if not all ETFs are passively-managed. The managers don't get paid for active management. So they don't have incentive to adjust the weights if their funds are tracking the benchmarks just fine.

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