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
Look beyond commodities for food profits
Despite the significant long-term growth potential in food demand, the prices of agricultural commodities are volatile, and as a group performed poorly over the past 15 years. Still, many of the larger companies involved in the industry have done well and outperformed the S&P 500 since 2007.


Investors should note the high level of volatility and risk involved with both agriculture commodities and the shares of producers....
2 min read
Pat McKeough
ETFs
It’s time for gold miners to shine for investors
Physical gold, silver, and palladium have been stellar performers over the past two decades, even beating the S&P 500. In the case of silver and palladium, this came at the expense of higher volatility, but not so for gold, which had a similar level of risk to the S&P 500.


Gold producers have underperformed physical gold over the past two decades but this may change as producers tighten their capital spending and start to reward investors with better dividends and share buybacks.


Russia is a major producer of precious metals....
2 min read
Pat McKeough
ETFs
Two new ETFs for Canadian investors
This month we highlight two new ETFs that invest in futures contracts linked to carbon credits.


Government regulations aimed at reducing carbon emissions include carbon credit trading systems. The systems effectively place a price on carbon emissions to compensate for their climate-change effects....
1 min read
Pat McKeough
ETFs
ETF’s top holding supplies key commodities
Sociedad Quimica Y Minera(SQM) is currently the largest holding in the iShares MSCI Chile ETF, making up a big 26% of its total assets. The company is a major global producer of lithium, iodine, and fertilizers.


SQM’s share price tends to follow a cyclical pattern over time as the prices of its main products fluctuate....
1 min read
Pat McKeough
ETFs
Chile offers promise for aggressive investors
After a strong 2021 fourth quarter, the Chilean economy has likely slowed this year, amid higher inflation and interest rates. Meanwhile, the country faces challenges: the possibility of new COVID-19 variants, higher energy prices pushed up further by the conflict in Ukraine, and uncertainties around the recent election of left-wing candidate Gabriel Boric as president....
4 min read
Pat McKeough
ETFs
Agriculture ETFs tap expanding demand
With yearly revenue of over $4 trillion, the global agriculture industry offers enormous opportunities for firms ready to satisfy growing food demand.


Crop and food prices will continue to fluctuate from year to year—as we’ve seen with wheat and fertilizer exports disrupted from major producers Russia, Belarus, and Ukraine. However, it’s a good bet that global food production and consumption will continue to increase....
4 min read
Pat McKeough
ETFs
Pass on this ETF
BMO U.S. PUT WRITE ETF $14.36 (Toronto symbol ZPW) sells put options on a range of U.S. large-cap stocks to generate income for the ETF. These options give the put buyers the right to sell specific stocks to the ETF at a pre-determined price....
1 min read
Pat McKeough
ETFs
These gold ETFs have more gains ahead
For many investors, gold represents a “safe harbour” in these turbulent times. That’s reflected in the sharp price jumps we continue to see—most notably in the wake of the Russian invasion of Ukraine.


Meanwhile, we expect gold-loving markets in Asia and other emerging economies to rebound after the coronavirus....
3 min read
Pat McKeough
ETFs
Buy the best of Taiwan

ISHARES MSCI TAIWAN INDEX FUND, $62.12, 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 Taiwan Semiconductor at 21.1% of assets....
1 min read
Pat McKeough
ETFs
Six North American ETFs: 5 buys, 1 hold
The major Canadian and U.S. stock markets, while subject to volatility, have moved back up since their initial COVID-19 drop. Nonetheless, we think that if you can afford to stay in the market for several years or longer, now is still a good time for new buying....
4 min read
Pat McKeough
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