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 Library Archives

Small-cap stocks come with additional risks

Smaller companies can generate higher returns than their larger counterparts, but they are often riskier and less liquid, and may underperform for long periods.
Small stocks are also more volatile in times of unsettled or falling markets.
Still, if you focus on the best-quality small companies—or ETFs… Read More

Cryptocurrency investments face challenges

Cryptocurrency is a form of digital, non-government-issued “money” that can be exchanged on the Internet without the intervention of a conventional bank or another intermediary.
In general, cryptocurrencies have underlying software code that enable their creation and allow users to verify and secure their transactions. Blockchain… Read More

Here are two new ETFs for Canadians

This month we consider a unique ETF that buys carbon credits to offset the emissions of its holdings. Meanwhile, we look at a new Canadian energy ETF that has energy stock booster Eric Nuttall as a manager.
The Evolve S&P/TSX 60 CleanBeta FUND $21.09 (Toronto… Read More

Tourism will help drive Mexico’s economic recovery

Tourism is an important economic industry in Mexico: pre-pandemic the segment directly accounted for 9% of GDP, and 6% of full-time paid employment.
The country is also a prominent global tourist destination, receiving 45 million international visitors in 2019, ranking 6th globally on the number of… Read More

Mexico looks to recover along with the U.S.

The Mexican economy was hit by the pandemic, especially from a disastrous drop in international tourists as COVID-19 kept visitors at home. But the economy is now recovering as the U.S. rebounds. In fact, Mexican stocks have largely bounced back to pre-pandemic levels.
Here’s a look… Read More

Small-cap ETFs for Canadian investors

Smaller firms can sometimes generate higher returns than their larger counterparts, but they are often riskier, less liquid, and may underperform for long periods. One way to offset some of the risk is to focus on ETFs that hold top-quality small-capitalization companies.
Here’s a look… Read More

Pass on this ETF

3D PRINTING ETF $37.34 (New York symbol PRNT) invests in publicly listed companies involved in the production and distribution of hardware, software and other materials related to 3-dimensional printing.
The fund aims to track the Total 3D-Printing Index.
The manager of the ETF, ARK Invest, believes… Read More

Three bitcoin ETFs with risk ahead

Bitcoin and other cryptocurrency assets have attracted considerable investor interest over the past few years. And, needless to say, ETF providers have jumped on this trend to provide investors with an opportunity to buy bitcoin—for a fee.
We think buying bitcoin as well as other cryptocurrencies… Read More

China comes out of COVID

SPDR S&P CHINA ETF, $126.10 (New York Exchange symbol GXC; buy or sell through brokers; www.spdrs.com) tracks the S&P China BMI Index. This includes all publicly traded Chinese stocks available to foreign investors.
Right now, the SPDR S&P China ETF holds 820 stocks. The fund launched… Read More

Tap Taiwan’s top stocks

ISHARES MSCI TAIWAN INDEX FUND, $64.50, is a buy for aggressive investors. The ETF (New York symbol EWT; buy or sell through brokers) gives you direct exposure to some of the top public companies of this East Asian powerhouse economy.
The fund’s largest holding is… Read More

Copper’s outlook is robust

GLOBAL X COPPER MINERS ETF, $37.00, is a buy. The ETF (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) lets you track the Solactive Global Copper Miners Index, with 30 global mining and exploration firms. It started up in April 2010.
Canadian firms… Read More

These two precious-metal ETFs are solid

Most precious-metal stocks dropped, along with stock markets, in March 2020. They then quickly reversed that trend to soar for investors, in part because of gold’s appeal as a “safe harbour” in uncertain times. In fact, in August 2020, gold jumped to over $2,000 U.S…. Read More

Here’s how ESG funds perform

Sustainable investing has expanded quickly over the past decade. Still, investors are rightly concerned about whether a focus on environmental, social, and governance (“ESG”) aspects may detract from their overall portfolio performance.
What is sustainable investing?
Many socially conscious investors now complement their traditional fundamental company… Read More

Inflation fears have only limited impact

In the past century, the world’s great powers have shifted from a gold-linked monetary system to a system based on fiat money—paper or electronic money with no intrinsic value. Fiat money only works as a medium of exchange/store of value because it has the backing… Read More

Commodities continue to shine

Stock markets, especially in the developed world, continued their rise in May. Commodity-producing nations, including Canada, lead the way. Notably, ETFs holding gold and oil producers were some of the big winners for the month.
On the other hand, decliners in the month included a.. Read More

Here’s two new ETFs for Canadian investors

This month we take a look at a new healthcare ETF from TD Asset Management, plus a very unique ETF from Horizons that focus on companies looking to develop psychedelic drugs for the treatment of mental illness.
TD Asset Management recently launched the TD Global… Read More

This ETF is focused on Philippine growth

Over the past few years, the Philippines has often made news headlines for the activities of its outspoken President. But the country also experienced a decade of strong economic growth—at least until the Covid-19 pandemic hit in 2020.
Here is one ETF that provides you… Read More

Sustainable funds keep expanding

Both mutual funds and ETFs that employ ESG criteria in the selection of their holdings have garnered significant interest over the past years. Their global pool of mutual fund and ETF assets is now estimated at just under $2 trillion.
Europe is host to most… Read More