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

Some semiconductor stocks offer less risk

The semiconductor industry has experienced strong growth over the past two decades. This is expected to continue as demand for technologically advanced products such as autonomous vehicles, 5G mobile applications, artificial intelligence (AI), and cloud computing, continues to rise.
Still, the market for basic memory-type conductors… Read More

Focus on stocks with strong fundamentals

To gain a better understanding of the stock market’s performance, portfolio managers often divide markets into smaller segments. Large, medium, and small companies are one way used to divide the market. Another is to divide the market into individual industry segments such as energy, consumer… Read More

Here are new ETFs for Canadian investors

With the goal of tapping into the popularity of high-yield investments, RBC recently launched an ETF that invests in Canadian dividend-paying companies—but with a covered call strategy. Meanwhile, we also look at an ETF focused on using leverage in bull markets but switching to short… Read More

Hindenburg targeted just one specific stock group

Hindenburg Research is known for producing reports aimed at companies with apparent poor corporate governance and controls.
In the process, the firm may take short positions in a target company with the expectation of profiting when their report is published.
In the past, Hindenburg has published reports… Read More

India’s growth prospects remain attractive

Growth this year for South Asia’s biggest economy is likely to come in at around 6%. That’s below its pre-pandemic growth rates of 8% or more, but it will still make India one of the world’s fastest-growing economies in 2023.
The country continues to face a.. Read More

The universe of actively managed ETFs keeps growing

Exchange-traded funds have traditionally been managed as passive, index-tracking investment vehicles. But that continues to change as more promoters launch actively managed ETFs into the market. Active management is when a fund manager picks stocks on an ongoing basis, rather than aiming to match benchmark… Read More

Semiconductor ETFs offer long-term promise

Many semiconductor (computer chip) stocks posted big gains after the pandemic hit in early 2020. That’s because sales of chips for personal electronics, such as computers, gaming hardware and so on, soared.
With COVID easing, demand for advanced chips—chips for automotive applications, datacentres, 5G technology and… Read More

Fundamental value wins in the long run

One of the best methods of building wealth over time is to zero in on the shares of companies (or the ETFs that hold them) with sound fundamental value. That includes a history of consistently strong sales and earnings, or cash flow. A solid balance… Read More

EVs bolster copper’s outlook

GLOBAL X COPPER MINERS ETF, $39.58, is a buy. The ETF (New York symbol COPX; buy or sell through brokers; lets you track the Solactive Global Copper Miners Index, with 40 global mining and exploration firms. It started up in April 2010.
Canadian firms make up 28.6% of the… Read More

Top ETFs to drive your precious-metal gains

Most precious-metal stocks dropped, along with the market, 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 times of economic uncertainty. In fact, in August 2020, gold jumped to over… Read More

Tap the top solar shares

INVESCO SOLAR ETF, $76.55, is a buy for aggressive investors. The ETF (New York symbol TAN; buy or sell through brokers) tracks solar-related companies (including technology firms and utilities) listed on global exchanges.
The fund’s top holdings are First Solar (China; solar panels) at 11.6%; SolarEdge Technologies (Israel; solar-power… Read More

These ETFs are ideal for your foreign buying

Generally speaking, Canadians are blocked from buying mutual funds that are registered in the U.S. unless those funds are also registered with provincial securities commissions. (Moreover, some Canadian mutual funds are only available in a limited number of provinces.)
Investors in this country can, however, buy… Read More

Exchange-traded Funds Portfolio for March 2023

You can see our Exchange-traded Funds Portfolio for March 2023 here.

ETFs in brief

Exchange-traded funds are set up to mirror the performance of a stock-market index or sub-index. They hold a more or less fixed selection of securities that represent the holdings of that index or… Read More

Don’t overlook mid-cap stock opportunities

Medium-sized companies are a bit like the proverbial middle child—they tend not to get as much attention from investors as the smallest or the biggest. But this creates opportunities for investors who are prepared to add the best of those stocks—or the ETFs that hold… Read More

Here are new ETFs for Canadian investors

Purpose Investments launched a series of leveraged single-stock ETFs in December 2022. Here we discuss the ETF that holds Apple shares but there are also similar ETFs that invest in single large U.S. companies, These include Amazon, Berkshire Hathaway, Alphabet, and Exxon. In addition, we… Read More

Commodities offer rewards as well as risks

Commodities are the raw materials that production and manufacturing rely on. Investing in them can help investors diversify their portfolios and win greater protection from inflation. However, commodities as a group can be both cyclical and volatile, and investors might rightly question the wisdom of… Read More

Mexico gains from North American trends

The Mexican manufacturing and export sectors have already grown significantly over the past two decades. But now, despite the country’s challenges, a unique set of circumstances present Mexico with an opportunity to develop these sectors even further. That will further advance it as a major… Read More

Mid-cap stocks will benefit your portfolio

Many investors overlook mid-cap stocks, thinking that a combination of large- and small-cap stocks will provide their portfolios with all the diversification they really need. However, as a group, U.S. mid-cap stocks have often performed better than large caps and are generally less risky than… Read More

Pass on this ETF: Vaneck Vectors Social Sentiment ETF

VANECK VECTORS SOCIAL SENTIMENT ETF $15.00 (New York symbol BUZZ) follows the BUZZ NextGen AI US Sentiment Leaders Index. This index tracks the 75 large-cap U.S. stocks that it believes have the highest degree of “positive investor sentiment.”
The fund aims to analyze millions of investment-related messages and… Read More