ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes as closely as possible, since investors cannot actually buy an index outright.

Exchange traded funds trade on stock exchanges, just like stocks. Investors can buy them on margin, or sell them short. The best exchange-traded funds offer well-diversified, tax-efficient portfolios with exceptionally low management ETF fees. They are also very liquid.

Investors use ETFs in a variety of ways, and some investors work only with ETFs and no other type of investment in portfolio creation.

An amazing aspect of ETFs is their diversity. Some investors may create an entire portfolio solely from a few well-diversified ETFs.

ETFs trade on stock exchanges, just like stocks. That’s different from mutual funds, which you can only buy at the end of the day at a price that reflects the fund’s value at the close of trading.

Prices of ETFs are quoted in newspaper stock tables and online. You pay brokerage commissions to buy and sell them, but their low management fees give them a cost advantage over most mutual funds.

As well, shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital gains taxes generated by the yearly distributions most conventional mutual funds pay out to unitholders.

ETFs have a place in every investor’s portfolio, at TSI Network we also recommend using our three-part Successful Investor strategy:

  1. Invest mainly in well-established companies;
  2. Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; the Consumer sector; Finance; Utilities);
  3. Downplay or avoid stocks in the broker/media limelight.

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ETFs Post Archives

How to choose the best investments for children

How to choose the best investments for children

Traditionally, there have been several options for parents and grandparents looking to make investments for children. But here’s how to choose the best investments for children in 2021.
Taking the time to pick the right investments for children and grandchildren is a worthwhile endeavour. If the… Read More

When to buy an ETF for maximum return

When to buy an ETF for maximum return

To determine when to buy an ETF, some investors use technical analysis and other tools. But you need to dig deeper.
Investors often wonder: what is a good entry point when purchasing a stock or an ETF?

The first question before asking when to buy an ETF… Read More

Invesco Cleantech ETF’s a buy for clean tech and sustainable investors

Invesco Cleantech ETF’s a buy for clean tech and sustainable investors

Sustainable investments continue to gain popularity with a fund that invests based on a company’s environmental impact, social behavior, and corporate governance.

This fund features firms engaged in renewable energy generation and infrastructure, low carbon emissions and other environmentally friendly businesses.

INVESCO CLEANTECH ETF (New York symbol… Read More

The top gold and silver stocks are stored in two ETFs

The top gold and silver stocks are stored in two ETFs

Precious-metal stocks dropped, along with stock markets, in March 2020 as the pandemic forced a global shutdown. They then quickly reversed themselves to soar for investors.

For many investors, gold and silver represent “safe harbours” in turbulent times and it’s why we expect further price jumps… Read More

How to pick the best Canadian index mutual funds

How to pick the best Canadian index mutual funds

Canadian index mutual funds were among the better financial innovations to come along in the past few decades. Still the popularity of ETFs may soon eclipse them
Canadian index mutual funds are specialized mutual funds that aim to equal the performance of a Canadian market index,… Read More

Blue chip ETFs focus on Canada

Blue chip ETFs focus on Canada

These two blue chip ETFs hold mostly large-capitalization, widely traded stocks on the Canadian exchange. Both funds mirror, or track, the performance of major stock market indexes as opposed to narrower ones focused on resources or themes, such as solar power or biotech.
Blue chip ETFs… Read More