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
ETFs
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 either directly holding commodities or the commodity producers themselves in their portfolios.


Long-term gains with more risk


Over the period since 2002, an investment in a basket of physical commodities delivered a return of just 5.4% per year, while commodity producers returned 9.5% per year; this compares with the 9.5% per year return of the S&P 500 index (see table below).


The IMF All Commodity Index provides a good measure of the performance of physical commodities as a group....
2 min read
Pat McKeough
ETFs
Mexico gains as it takes export market share from China
Despite an ongoing trade war, high tariffs, and COVID-impacted supply lines, the U.S. still imported goods worth more than $500 billion from China in 2021. In that same year, Mexico was a distant second as a trade partner, delivering $385 billion of goods to the U.S.


However, Mexico now seems poised to contribute a larger share of U.S....
1 min read
Pat McKeough
ETFs
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 manufacturing hub for North America.


Here is one ETF that provides exposure to the top Mexican publicly listed companies.


ISHARES MSCI MEXICO ETF $55.85 (New York symbol EWW; TSINetwork ETF Rating: Aggressive; Market cap: $1.25 billion) tracks the performance of the largest publicly listed Mexican companies.


Consumer Defensive stocks account for 29% of its assets, while Financial Services (18%), Communication Services (16%), Industrials (15%), and Basic Materials (12%) are other key segments.


The ETF holds a portfolio of 44 stocks; the top 10 holdings make up a sizeable 64% of holdings....
4 min read
Pat McKeough
ETFs
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 small caps....
4 min read
Pat McKeough
ETFs
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 posts on sites, like Reddit, Stocktwits and Twitter, using what it believes is sophisticated computer software....
1 min read
Pat McKeough
ETFs
Buy commodities for portfolio balance
Most commodity production is capital intensive with long development times. Producers face considerable costs to establish or replace mines, oilfields, and so on, or to build processing, storage and transportation facilities. This means that the selling prices of their products can vary significantly from the time of their initial investment decisions....
3 min read
Pat McKeough
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
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