ETFs | Education
ETFs | Education
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Glossary of Key Terms
Market Order
A market order is an instruction by an investor to a broker to buy or sell stock shares, bonds, or other assets at the best available price in the current financial market.
Limit Order
A limit order is a type of order to purchase or sell a security at a specified price or better. For buy limit orders, the order will be executed only at the limit price or a lower one, while for sell limit orders, the order will be executed only at the limit price or a higher one. This stipulation allows traders to have more control over the prices they trade.
Stop Order
A stop order is an order to buy or sell a security when its price moves past a particular point, ensuring a higher probability of achieving a predetermined entry or exit price, limiting the investor's loss, or locking in a profit. Once the price crosses the predefined entry or exit point, the stop order becomes a market order.
Margin Buying
Buying on margin occurs when an investor buys an asset by borrowing the balance from a bank or broker.
Short Selling
Short selling is an investment or trading strategy that speculates on the decline in a security's price.
ETF Liquidity
ETF liquidity refers to the relative trading volume and bid/ask spreads of both the ETF itself (secondary market) and its underlying holdings (primary market). In general, the greater the trading volume, the more liquid the security.
Liquidity Provider
ETF liquidity provider’s serve as mediators between brokerage companies and investors. They are responsible keeping pricing and markets efficient.
Investing in Harbor’s ETFs
Any information needed to identify Harbor’s ETFs can be found on our ETF product pages. Harbor believes that active ETFs are a good way to access these compelling investment strategies while potentially being a tax-advantaged investment. All fund materials, including performance information, factsheets, prospectuses, etc. are available on the ETF product pages. It is important to note that investors should consult a financial professional, an attorney, or tax professional regarding the investor’s specific situation.
Our ETFs are available through various channels including broker-dealers, investment advisers, and other financial services firms, including Envestnet, Fidelity, Pershing, Schwab, TD Ameritrade and more.
Please note that you cannot buy Harbor ETFs directly through Harbor Capital Advisors, Inc.
Information and Disclosure
Investing involves risk, principal loss is possible. Unlike mutual funds, ETFs may trade at a premium or discount to their net asset value.
Shares are bought and sold at market price not net asset value (NAV). Market price returns are based upon the closing composite market price and do not represent the returns you would receive if you traded shares at other times.
ETFs are subject to capital gains tax and taxation of dividend income. However, ETFs are structured in such a manner that taxes are generally minimized for the holder of the ETF. An ETF manager accommodates investment inflows and outflows by creating or redeeming “creation units,” which are baskets of assets. As a result, the investor usually is not exposed to capital gains on any individual security in the underlying portfolio. However, capital gains tax may be incurred by the investor after the ETF is sold.
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