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From an investment strategy standpoint, traditional exchange-traded funds (ETFs) are designed to track indexes. ETFs are available in hundreds of varieties, tracking nearly every index you can imagine; they offer all of the benefits associated with index mutual funds, including low turnover, low cost and broad diversification, plus their expense ratios are significantly lower. While passive investing is a popular strategy among ETF investors, it isn’t the only strategy. Here we explore ETF investment strategies to provide additional insight into how investors are using these innovative instruments.

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