A thematic ETF is an exchange-traded fund that focuses on a specific sector or trend in the economy. Thematic ETFs are designed to provide exposure to a particular theme, such as clean energy, technology, healthcare, or robotics, by investing in a basket of stocks that fall under that theme. Thematic ETFs enable investors to gain access to a sector or trend without having to pick individual stocks.
In the context of index funds or exchange-traded funds (ETFs), tracking difference measures the deviation of the fund's returns from the returns of the benchmark index that it is designed to track. A low tracking difference indicates that the fund is closely following the performance of the benchmark, while a high tracking difference indicates that the fund is deviating from the benchmark. Tracking difference can be influenced by a variety of factors, including the fund's investment strategy, management fees, and trading costs. It can also be impacted by factors such as the liquidity and rebalancing of the underlying securities in the benchmark. Investors should consider tracking difference when evaluating index funds or ETFs, as...
Based on the difference of the benchmark indexes return compared to the return from the ETF. The benchmark being the index that the ETF has stocks in, and since the ETF mirrors the benchmark their values should be similar.