ETFs - The Successful Investor Inc

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:

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

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You Can See Our Exchange-Traded Funds Portfolio For September 2023 Here.

ETFs in brief

Exchange-traded funds are set up to mirror the performance of a stock-market index or sub-index....

1 min read

Pat McKeough

ETFs

Natural resources also offer risks and returns

Physical commodities and publicly listed producers of commodities have delivered steady returns over time when compared to the overall stock market. However, this comes at the cost of more volatility.

Commodities have many sub-categories each with their own dynamics....

2 min read

Pat McKeough

ETFs

Risks and rewards within the healthcare sector

Demand for healthcare products and services has been growing for decades—and this will continue as the population of the developed world grows older and medical services expand. Significant new developments in the field of medical technology and innovation will further boost the demand for medical services.

In this Supplement, we take a look at the performance of the broad global and U.S....

3 min read

Pat McKeough

ETFs

Here are new BMO ETFs for Canadian investors

BMO recently added eight new ETFs to their already extensive Canadian lineup. Here’s a look at two of the new BMO ETFs now available to Canadian investors.

BMO GLOBAL HEALTH CARE ETF $15.58 (NEO Exchange symbol BGHC) invests globally in publicly traded health care businesses....

1 min read

Pat McKeough

ETFs

Rolls Royce Holdings should soar with aviation growth

Rolls Royce Holdings is one of the stocks included in the EWU ETF, highlighted in this issue. But notably, this company no longer owns the legendary car franchise—Rolls Royce Motor Cars is now owned and operated by Germany’s BMW.

Rolls Royce Holdings is listed on the London Stock Exchange with a market value of $16 billion U.S....

1 min read

Pat McKeough

ETFs

The U.K. is ramping up for future growth

The United Kingdom has one of the largest economies in Europe and is among the world’s top 10. However, over the near term, it faces challenges. This includes high inflation, which has forced interest rate hikes, and an overall slower global economy, which has hurt exports....

4 min read

Pat McKeough

ETFs

Cut your commodity risk with these ETFs

Commodities can help diversify portfolios, but are cyclical and come with high levels of price volatility.

However, well-diversified ETFs that offer exposure to commodity producers can help investors overcome the problems associated with direct investments in physical commodities, or funds that track a single commodity.

Below, we look at three ETFs providing exposure to commodity producers....

4 min read

Pat McKeough

ETFs

Pass on this ETF: Direxion Daily S&P Biotech 3X Bull ETF

DIREXION DAILY S&P BIOTECH 3X BULL ETF $4.98 (New York symbol LABU), provides highly leveraged exposure to the S&P Biotechnology Select Industry Index. The ETF aims to generate returns three times the daily movement of the S&P Biotechnology Index.

The fund launched in May 2015 and has a large asset base of $1.05 billion....

1 min read

Pat McKeough

ETFs

Healthcare ETFs tap into key trends

Healthcare companies as a group performed well over the past decade or so—including big growth spurts during and after the pandemic that pushed many of them to new highs. The underlying growth trends remain strong as the global population grows older and emerging economies spend more on healthcare.

Here are two ETFs that aim to benefit from the opportunities presented by healthcare....

3 min read

Pat McKeough

Testimonials

The cornerstones of Pat’s strategy–value, diversification and timelines–make his newsletter, The Successful Investor, highly profitable while minimizing risk. His advice is no-nonsense, down-to-earth and based on solid research. You’ll know what to invest in and what to avoid.

Chuck Chakrapani, PhD
Investors Association of Canada
The older I get the better dividends look. For retirees and would-be retirees who want to sleep at night, I can’t think of a better source of information on reliable growing dividend income than Pat McKeough’s newsletter, Dividend Advisor.

Jonathan Chevreau
Financial Post Columnist
As a manager of more than $500 million in mutual funds, I have access to the best brokerage research available in this country. But I still take time to read Pat McKeough’s premium newsletters

John Sartz
I appreciate the 25 years of above market returns I received by following your advice. at least 95% of my investment decisions were based on TSI recommendations.

Chuck J.
Subscriber since 1996. Inner Circle Member Since 2006
The newsletters I receive in Inner Circle Pro are fantastic! I have been following Pat’s advice for years and everything he has said has been amazing. His commentaries are brilliant, insightful, educational, rational and balanced. My returns are almost double the TSE and I have referred many of my friends who have switched over to your services.

Walter H.
Inner Circle Pro subscriber

Browse Premium Topics

Cannabis

Spinoffs

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a corporate subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors.

Dividend Stocks

Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

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.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Blue Chip Stocks

Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

Penny Stocks

A penny stock in general trades for under five dollars a share, and as the name implies, sometimes for pennies. Most of the time they’re young companies, or start-ups in speculative markets like mining or technology.

Growth Stocks

Growth stocks are companies that are likely to have sales and earnings growth well above market average. Frequently they pay few, if any, dividends. Instead they typically reinvest any extra cash flow to promote further growth. Chosen wisely—according to Pat McKeough’s advice—high-quality growth-oriented stocks can be worthwhile additions to most well-diversified portfolios.

Wealth Management

Wealth management is the practice of putting your savings to work so that it continues to grow over your lifetime and will also benefit your heirs. Wealth management encompasses many different areas of investing like long term investment planning and retirement planning.

Mining Stocks

Mining stocks are investments in companies that produce or explore for minerals. Some of these minerals include uranium, coal, molybdenum (which is used in steelmaking), copper, silver and gold. They are affected by fluctuating commodity prices in addition to their own business and operating risks.

How To Invest

Pat McKeough has been making investing for beginners simple—and profitable—by helping investors make big gains for more than 25 years. His advice to beginning investors is the same as it is for all investors: buy high-quality, mostly dividend paying stocks (or ETFs that hold these stocks) and evenly spread your investments over the five main economic sectors (Resources, Manufacturing, Finance, Utilities and Consumer). Pat also believes investors should avoid stocks in the broker/media limelight and focus on those with hidden or little-noticed assets.

Energy Stocks

What are energy stocks?

Businesses that work in the extraction, refining and delivery of energy sources such as natural gas, oil, uranium and coal, are considered energy stocks.