I'm trying to find out what the types of ETFs are and ran into some confusion: A webpage (http://etfdb.com/portfolio-management/the-7-different-etf-structures/) lists ETNs as a type of ETF. But an Investopedia page (http://www.investopedia.com/terms/e/etn.asp) says that ETNs are "like" ETFs. Which is it?

1 Answer 1



They're exchange traded debt, basically, not funds.

E.g. from the NYSE:

An exchange-traded note (ETN) is a senior unsecured debt obligation designed to track the total return of an underlying market index or other benchmark, minus investor fees.

Whereas an ETF, in some way or another, is an equity product - which doesn't mean that they can only expose you to equity, but that they themselves are a company that you buy shares in.

Debt ETN/ETF example

FCOR for example is a bond ETF, basically a company whose sole purpose is to own a basket of bonds. Contrast that to DTYS, a bear Treasury ETN, which is described as

The ETNs are unsecured debt obligations of the issuer, Barclays Bank PLC, and are not, either directly or indirectly, an obligation of or guaranteed by any third party.

Also from Barclays site:

Because the iPath ETNs are debt securities, they do not have any voting rights.

FCOR on the other hand is some sort of company owned/managed by a Fidelity trust, though my EDGAR skills are rusty.

AGREEMENT made this 18th day of September, 2014, by and between Fidelity Merrimack Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the “Trust”), on behalf of Fidelity Corporate Bond ETF (hereinafter called the “Fund”), and Fidelity Investments Money Management, Inc., a New Hampshire corporation (hereinafter called the “Adviser”) as set forth in its entirety below.

  • That's confusing because, to my knowledge, there are plenty of bond ETFs.
    – nCardot
    Apr 10, 2017 at 20:35
  • @WalletSage if you look at a bond ETF, FCOR for instance, you create and redeem units by delivering or receiving the basket of bonds the ETF holds - the ETF itself is a corporation/trust that owns the portfolio of bonds, and you own equity in that corporation. Let me add some color to my answer.
    – dsolimano
    Apr 10, 2017 at 22:18

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