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.

[text_ad]

Read More Close

ETFs Library Archives

ETFs

Tap the best of Vietnam

VANECK VECTORS VIETNAM ETF, $12.69, is a buy for aggressive investors. This emerging-markets ETF (New York symbol VNM) taps the leading Vietnamese firms as well as foreign firms that get a significant share of their revenue from this Southeast Asian nation....

1 min read

Pat McKeough

ETFs

Hang onto this REIT fund

ISHARES S&P/TSX REIT INDEX ETF, $18.40, is a hold. The ETF (Toronto symbol XRE; buy or sell through brokers; ca.ishares.com) lets investors tap all 18 Canadian real estate investment trusts in the S&P/TSX REIT Index....

1 min read

Pat McKeough

ETFs

Four ETFs buys for your global gains

Most top global markets have rebounded since their big drop at the outbreak of the pandemic. Going forward, we think the outlook remains positive for quality stocks. One way to profit from that—while cutting your risk—is to invest in top ETFs.

Here’s a look at four international funds that we believe are suitable for your new buying....

7 min read

Pat McKeough

ETFs

Here’s how ESG returns stack up

Sustainable investing has grown exponentially over the past decade, while its scope has broadened and the approach has become more sophisticated. As of December 2021, assets under management at global exchange-traded funds that publicly set environmental, social, and governance (“ESG”) investment objectives amounted to more than $2.7 trillion; 81% were in European-based funds, and 13% were in U.S.-based funds.

According to research published by Morningstar in 2018, 16 out of 20 equity indexes in the Morningstar Global Sustainability Index family, have beaten their non-sustainability equivalents over their lifespans....

2 min read

Pat McKeough

ETFs

Bonds lower volatility but also your returns

Here’s a look at how holding bonds compares to investing in stocks over time.

We’re using readily available data (see table at right) from the U.S. to demonstrate the long-term performance track record and the risk profiles of various asset classes, including government and corporate bonds.

The annual growth in U.S....

2 min read

Pat McKeough

ETFs

Here are new ETFs for Canadian investors

This month we highlight a long-short ETF from alternative fund manager Arrow Capital, plus a high-risk ETF from BMO/ARK Investments.

The objective of the ARROW CANADIAN ADVANTAGE ALTERNATIVE ETF $20.26 (Toronto symbol ACAA) is to achieve strong capital appreciation through investment in both short and long positions of primarily Canadian equities.

The ETF launched in November 2022 and its MER is 0.65% plus a 20% performance fee for returns over 6% per year.

The fund’s long positions included TransAlta, Altagas, Freehold Royalties, and Spin Master....

1 min read

Pat McKeough

ETFs

Sweden is home to a number of top global companies

Apart from the iconic IKEA home furniture stores, Sweden is also base to a range of other high-quality multinational companies. Here is a summary of some of the companies that are included in the ETF.

LM Ericsson is a provider of network equipment and software for wireless communications systems....

1 min read

Pat McKeough

ETFs

This Nordic leader has long-term appeal

The free market-orientated economy of Sweden is complemented by a comprehensive welfare system. Despite a high-tax regime, the country ranks among the most competitive in the world and is home to a range of successful multinational companies.

The country faces near-term challenges—households and businesses are under pressure from high inflation and rising interest rates....

4 min read

Pat McKeough

ETFs

These ETFs target ‘responsible’ investing

Over the last few years, more and more ETF managers have launched funds focused on taking environmental, social, and governance (ESG) factors into account.

Sustainable investing offers some investors a lot of conceptual and emotional appeal. But does investing in these kind of stocks hurt your portfolio returns? Yes and no.

One way investing in sustainable ETFs can hurt performance is the ethical criteria used could keep investors out of promising stocks with the power to boost your long-term portfolio returns....

4 min read

Pat McKeough

ETFs

Your #1 ETF for 2023

ISHARES CANADIAN SELECT DIVIDEND INDEX ETF $28.00 (Toronto symbol XDV) lets you hold 30 of the highest-yielding Canadian stocks. The ETF also considers dividend growth and payout ratios to make its selections.

The weight of any one stock holding is limited to 10% of the fund’s assets....

1 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.