Can someone explain this ETF explanation?

CFA Level I Portfolio Management
#1

Exchange-traded funds (ETFs). exchange-traded notes (ETNs) trade like closed-end funds but have special provisions allowing conversion into individual portfolio securities, or exchange of portfolio shares for ETF shares, that keep their market prices close to the value of their proportional interest in the overall portfolio. These funds are sometimes referred to as depositories, with their shares referred to as depository receipts.

What does it exactly mean by conversion into individual portfolio securities here?

#2

If the ETF holds, say, only GOOG, JNJ, and MCD stock, you can exchange ETF shares for shares of GOOG, JNJ, and MCD (in the correct proportions) and vice versa.

#3

Thank you S2000magician! Your responses never fail to help!

#4

And now that I read your answer, I find my doubt kinda silly haha

#5

My pleasure.

You’re too kind.