<human>: What's the difference between an ETF and a mutual fund?
<bot>: An ETF is a type of investment that combines the features of both stocks and bonds. It trades on exchanges like stocks, but it’s backed by a basket of securities, such as stocks, bonds, or commodities. Mutual funds are pooled investments in which investors can buy shares in a professionally managed portfolio of securities. Mutual funds typically offer more diversification than ETFs because they hold many different types of investments.