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ETF Tax Efficiency Report Card

by on December 22, 2010 | Updated April 25, 2013

When rattling off the advantages that ETFs hold compared to traditional actively-managed mutual funds, most investors usually start with the issue of expenses. The easiest comparison to make involves expense ratios, the fees charged by ETF and mutual fund companies for investing in a product. Though some mutual funds offer single-digit expense ratios, most actively managed products charge in excess of 1% (the average for the mutual fund industry is in the neighborhood of 1.4%). By comparison, the average expense ratio for ETFs is less than 0.60%, and there are more than a dozen funds that charge less than 10 basis points. [click to continue…]

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ProShares Plans 300% Leveraged ETFs

by on February 8, 2010 | Updated February 11, 2010

ProShares, the issuer responsible for pioneering leveraged and inverse ETFs, has filed prospectuses for 16 new funds. Expansion is nothing new for ProShares–the company has launched a handful of new ETFs over the last year–but the filing was interesting because it detailed plans for 300% leveraged ETFs. ProShares’ current product line, which consists of more than 90 funds, includes only two ETFs with 300% leverage, the UltraPro S&P 500 (UPRO) and UltraPro Short S&P 500 (SPXU). [click to continue…]

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Over the last year, leveraged ETFs have been the subject of intense scrutiny from a number of parties, including regulatory agencies, state governments, broker-dealers, individual investors, and even class action lawyers. While several aspects of leveraged ETFs have been thoroughly analyzed and debated, perhaps no issue has drawn more attention than the effects of compounding […]

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In the week during which the Obama administration will unveil details surrounding its plan to revamp the regulation of the U.S. financial sector, calls for increased oversight of the ETF industry are picking up steam as well. Scott Burns, director of ETF Analysis at Morningstar, recently laid out a case for increased regulatory requirements for ETFs […]

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