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Exchange Traded Funds (ETFs) are similar to mutual funds in
some ways and like a stock in others. They are listed and traded
on exchanges like stocks. Like mutual funds, these funds are
groupings of individual stocks, bonds or other investments.
Unlike mutual funds, an investor may buy or sell shares
throughout the day. When shares of a mutual fund are bought or
sold, the shares are purchased or redeemed through the fund and
the overall net asset value of the fund is affected. Many ETFs
are index based, which may result in lower internal fees than
with actively managed mutual funds since no day-to-day active
management is required. These investments simply seek to
replicate the index they are modeled after.
Exchange Traded Funds have been around since the early 1990’s
but are still relatively unknown in everyday investing. Why?
These investment vehicles have been used by financial
professionals, and not heavily marketed directly to the
individual investor until now. You may have heard of some of the
more common examples of ETFs: SPYDERS (SPY), DIAMONDS (DIA) AND
CUBES (QQQQ), these are all Exchange Traded Funds.
EXCHANGE TRADED FUNDS:
THE FUTURE OF INVESTING – TODAY
- Low cost
- Tax-efficient
- Diversification
ETFidea, LLC offers individuals and their advisors a way to utilize
Exchange Traded Funds, as well as other investments in a managed
program. These funds are selected for each client based on risk
tolerance, time horizon and individual investment objectives.
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