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Depository Trust Company (DTC)
The Depository Trust Company (DTC) is a centralized securities depository in the United States that provides clearing and settlement services for the securities industry. The DTC serves as a link between the issuers of securities, such as companies and government entities, and the buyers and sellers of those securities in the secondary market.
The DTC acts as a centralized clearinghouse, which means that it eliminates the need for physical certificates to be traded between buyers and sellers. Instead, the DTC holds electronic records of ownership, known as book-entry securities, which are transferred electronically between buyers and sellers through the DTC's systems. This greatly reduces the risk of lost, stolen, or damaged certificates and simplifies...
Derivatives-based Commodity ETFs
Derivatives-based commodity ETFs are exchange-traded funds that provide exposure to the prices of commodities such as metals, energy, or agricultural products through the use of derivatives such as futures contracts. These ETFs are designed to provide investors with a convenient and cost-effective way to gain exposure to commodity markets, without the need to take physical delivery of the underlying assets.
Derivatives-based commodity ETFs typically invest in futures contracts, which are agreements to buy or sell a specific commodity at a predetermined price on a future date. The ETFs aim to track the performance of a benchmark commodity index, such as the S&P GSCI (S&P Goldman Sachs Commodity Index), by investing in a basket of...
Direct Indexing
ETFs have what is called a "wrapper" which means that there is a predetermined number of securities that it holds. This new process instead allows you to pick and choose which securities you wish to own. This in turn takes out the middleman which leaves you with less guidance for more freedom.
Diversification
Diversification is an investment strategy aimed at reducing risk by spreading investments across a variety of assets, industries, and geographic locations. By diversifying, investors aim to reduce the impact of the performance of any single investment on their portfolio. This helps to minimize the risk of losses from any one security, sector or market and provides the potential for a more stable return over time. Diversification is a key principle of modern portfolio theory and is often used in conjunction with asset allocation to manage risk in an investment portfolio.