Financial advisors and individual investors who have embraced ETFs are generally painted as a cost conscious crowd, passing over expensive active mutual funds in favor of cheap indexing strategies. In general ETFs are considerably cheaper than mutual funds, thanks not only to the indexing strategy but also to the more efficient exchange-traded structure.
But not all ETFs and ETNs are equally tax efficient; in many cases, the differential between products offering similar exposure can be meaningful. In fact, there are several examples of products linked to identical indexes with wildly different expense structures. And while there has been a movement towards cheaper products, a number of more expensive ETFs remain tremendously popular. So much so that movements from a handful of funds to lower cost alternatives could result in aggregate annual savings of more than $400 million in management fees–without altering the underlying index [see 25 Things Every Financial Advisor Should Know About ETFs] . [click to continue…]
Commodity ETPs can be extremely powerful tools for tapping into an asset class capable of providing both return enhancement and diversification benefits. With dozens of products available–there are more than 120 U.S.-listed commodity ETFs according to the ETF screener–picking the right fund for your investment objectives and risk tolerances can be challenging. Beyond the type [...]
Any investor who hasn’t been living under a rock probably has some idea as to why the ETF industry has been expanding so quickly over the last several years. Intra-day liquidity, enhanced tax efficiencies, and a degree of transparency not available in many other structures are all common causes of the explosive growth in both [...]
When running down the benefits of constructing a portfolio with ETFs, most investors will touch on the potential for enhanced tax efficiency, intra-day liquidity, and transparency in holdings. But the biggest benefit, in the minds of those accustomed to using primarily actively-managed mutual funds, are the low expense ratios. Most passively-indexed ETFs charge fees equal [...]
With 2011 just around the corner, tis the season for pledges to better everything from health to wealth to happiness in the coming year. Below, we offer up ten New Years’ Resolutions for ETF investors looking to cut expenses, round out their portfolios, and maximize returns in 2011 [for more ETF insights, sign up for [...]
As ETFs have burst on to the scene in recent years and worked their way into the investing mainstream, the number of products available and complexity of exposure offered has increased significantly. Advisors and investors have taken steps to educate themselves on the ins and outs of ETFs, but many are still scrambling to play [...]
The first quarter of 2010 was one of the most active periods in recent memory for the ETF industry. Approximately 60 new funds hit the market during this three month period, continuing the impressive expansion and innovation that has become standard in a space that has huge potential (see the March ETF Roundup). This trend [...]
The rise of the ETF industry is often attributed (in large part at least) to a shift in investor preference from pricey active management to low-cost indexing strategies. ETFs burst on to the investment scene by offering fees equivalent to only a fraction of those charged by traditional actively-managed mutual funds, and have continued to [...]
ETFs have surged in popularity in recent years in part because of the numerous advantages they offer over traditional actively-managed mutual funds: lower costs, potential tax efficiencies, intraday trading, and enhanced transparency. But ETFs aren’t without potential drawbacks of their own. Although most funds appear relatively simple on the surface, there are some rather complex [...]
Thursday marked the first day of trading for the UBS E-TRACS S&P 500 Gold Hedged ETN (SPGH), a unique product that offering investors exposure to large cap equities along with a hedge against a declining U.S. dollar. SPGH will track the S&P 500 Gold Hedged Index, a benchmark designed to measure the performance of an [...]
Commodities are the new black in the world of investing, thanks in no small part to the rise of ETFs as the tool of choice in more and more portfolios. Commodity ETFs saw cash inflows of more than $30 billion in 2009, as total assets more than doubled on the year. According to the ETF [...]
