Which statement about ETFs is true?

Exchange-Traded Funds (ETFs) are designed to be traded on an exchange, much like individual stocks. This provides investors with the flexibility to purchase and sell shares of the ETF throughout the entire trading day, allowing for immediate execution at current market prices. This characteristic is one of the key distinctions between ETFs and traditional mutual funds, which only trade at the end of the trading day at the net asset value (NAV). As a result, option C accurately reflects this fundamental feature of ETFs, highlighting their appeal for those who value real-time trading capabilities.

The other choices do not accurately describe ETFs. For instance, many ETFs typically have lower operating expenses compared to mutual funds, countering the claim about higher expenses. Additionally, while ETFs can generally be purchased on margin, certain limitations may apply, but this does not universally preclude them from being marginable. Finally, the assertion that ETFs always yield higher returns than open-end investment companies is misleading, as returns can vary widely based on market conditions, management strategies, and asset classes.