ETF or Exchange Traded Fund can simply be defined as mutual fund traded in the Exchange. Just like mutual fund, ETF is a Collective Investment Contract, but similar to shares, its investment unit is listed and traded in the Exchange. Like conventional mutual fund, ETF also uses an Investment Manager and Custodian Bank.
ETF trading mechanism is similar with stock trading mechanism, except that its price step is Rp 1 (one Rupiah) and its maximum price step is Rp 10 (ten Rupiah).