ETFs

What are ETFs?

ETF is an acronym for exchange traded fund. These exchange traded funds are used to track indexes in terms on holdings and returns as closely as possible. That’s because investors cannot actually buy an index itself.

These ETFs trade on 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.

The trading of ETFs on stock exchanges is 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 online and newspaper stock tables just like stocks. 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, although we advise sticking with “plain vanilla” ETFs that simply track indexes rather than relying on the decision-making of fund managers. Indeed, at TSI Network we also recommend using our three-part Successful Investor strategy when making those choices:

  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.

How to Make Money with ETFs

Learn everything you need to know in ‘The ETF Investor’s Handbook’ for FREE from The Successful Investor.

ETFs Guide for Canadian Investors: Find the best way to invest in ETFs with low fees, low risk & high satisfaction.


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ETFs Post Archives

Currency Hedging Comes At a Cost With ETFs

Currency Hedging Comes At a Cost With ETFs

Any currency volatility can send investors hunting for hedged ETFs. But the extra costs limit the appeal of currency hedging as a strategy.
If you want to buy U.S. stocks and hedge against the U.S. dollar’s movements against the Canadian dollar, you could buy a hedged… Read More

When to buy an ETF for maximum return

When to buy an ETF for maximum return

To determine when to buy ETFs, 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, when… Read More

Pros and Cons of Renewable Energy ETFs

Pros and Cons of Renewable Energy ETFs

Renewable energy ETFs have attracted popular approval, and not just with socially conscious investors. Still, are these ETFs good investments?
What are renewable energy ETFs?
Renewable energy ETFs are exchange-traded funds that invest in companies involved in clean energy production, distribution, and technology, including solar, wind, hydroelectric,… Read More

Why These Two iShares MSCI ETFs Are Your Best Bets for Portfolio Diversification

Why These Two iShares MSCI ETFs Are Your Best Bets for Portfolio Diversification

These iShares MSCI funds offer investors global diversification across two fundamentally different but economically significant markets. They provide exposure to developed economies with distinct economic drivers, sector compositions, and geographic advantages. Together, they create a complementary investment approach that balances industrial strength with a resource-rich… Read More

iShares Canadian Select Dividend Index ETF Delivers a 3.6% Yield for Income-Seeking Investors

iShares Canadian Select Dividend Index ETF Delivers a 3.6% Yield for Income-Seeking Investors

Exchange-traded funds have revolutionized investment accessibility since their introduction, offering several distinct advantages over traditional investment vehicles. One of the primary benefits is portfolio diversification, which allows investors like you to gain exposure to numerous securities through a single transaction.

The cost efficiency of ETFs represents… Read More

Canadian Blue Chips Dominate These Two Canadian ETFs

Canadian Blue Chips Dominate These Two Canadian ETFs

These two Canadian ETFs track Canada’s best-established indexes and provide low-fee exposure to widely traded blue chip stocks.
When you invest in ETFs, simpler is generally better. And each of these two Canadian ETFs provides a straightforward approach to investing in a selection of Canada’s top… Read More

2 Precious Metal ETFs to Buy

2 Precious Metal ETFs to Buy

Precious metal ETFs have largely centered on gold stocks. We continue to see the outlook for that precious metal as positive, and for aggressive investors who want to hold precious metal ETFs, including a silver ETF, we have two of them below.

Most precious-metal stocks dropped,… 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