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

Copper’s outlook is robust

GLOBAL X COPPER MINERS ETF, $37.00, is a buy. The ETF (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) lets you track the Solactive Global Copper Miners Index, with 30 global mining and exploration firms. It started up in April 2010.

Canadian firms make up 37.7% of the ETF’s holdings....

1 min read

Pat McKeough

ETFs

These two precious-metal ETFs are solid

Most precious-metal stocks dropped, along with stock markets, 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 uncertain times. In fact, in August 2020, gold jumped to over $2,000 U.S....

2 min read

Pat McKeough

ETFs

Here’s how ESG funds perform

Sustainable investing has expanded quickly over the past decade. Still, investors are rightly concerned about whether a focus on environmental, social, and governance (“ESG”) aspects may detract from their overall portfolio performance.

What is sustainable investing?

Many socially conscious investors now complement their traditional fundamental company analyses with an additional review of a firm’s environmental, social, and governance practices....

2 min read

Pat McKeough

ETFs

Inflation fears have only limited impact

In the past century, the world’s great powers have shifted from a gold-linked monetary system to a system based on fiat money—paper or electronic money with no intrinsic value. Fiat money only works as a medium of exchange/store of value because it has the backing of government decrees or fiats.

This long-term multinational experiment, accelerated by massive pandemic stimulus spending, could struggle on for decades to come—or it could come unglued abruptly....

3 min read

Pat McKeough

ETFs

Commodities continue to shine

Stock markets, especially in the developed world, continued their rise in May. Commodity-producing nations, including Canada, lead the way. Notably, ETFs holding gold and oil producers were some of the big winners for the month.

On the other hand, decliners in the month included a number of high-flying tech, Internet, and biotech ETFs....

1 min read

Pat McKeough

ETFs

Here’s two new ETFs for Canadian investors

This month we take a look at a new healthcare ETF from TD Asset Management, plus a very unique ETF from Horizons that focus on companies looking to develop psychedelic drugs for the treatment of mental illness.

TD Asset Management recently launched the TD Global Healthcare Leaders Index ETF $15.57 (Toronto symbol TDOC)....

1 min read

Pat McKeough

ETFs

This ETF is focused on Philippine growth

Over the past few years, the Philippines has often made news headlines for the activities of its outspoken President. But the country also experienced a decade of strong economic growth—at least until the Covid-19 pandemic hit in 2020.

Here is one ETF that provides you with exposure to the top companies listed in the Philippines.

ISHARES MSCI PHILIPPINES ETF $31.90 (New York symbol EPHE; TSINetwork ETF Rating: Aggressive; Market cap: $128.1 million) tracks the performance of the largest publicly listed Philippine companies.

Industrial companies account for 31% of this ETF’s assets, while Real Estate (24%), Financials (16%), Utilities (7%), Consumer Discretionary (7%), and Communications (6%) are other key segments.

The ETF holds a portfolio of 40 stocks; the top 10 holdings make up 59.7% of its assets.

They are SM Prime Holdings (Real Estate, 11.1%), Ayala Land (Real Estate, 8.5%), SM Investments (Industrials, 7.1%), Ayala Corporation (Industrials, 6.3%), International Container Terminals (Industrials, 5.5%), Bank of Philippine Islands (Financials, 4.7%), JG Summit Holdings (Industrials, 4.7%), BDO Unibank (Financials, 4.7%), PLDT Inc (Communication, 3.9%), and Metropolitan Bank (Financials, 3.4%).

The ETF started up in June 2000 and charges an MER of 0.59%....

4 min read

Pat McKeough

ETFs

Sustainable funds keep expanding

Both mutual funds and ETFs that employ ESG criteria in the selection of their holdings have garnered significant interest over the past years. Their global pool of mutual fund and ETF assets is now estimated at just under $2 trillion.

Europe is host to most of the funds, while Canada has $14.2 billion in ESG assets spread across 156 ESG funds....

1 min read

Pat McKeough

ETFs

These ETFs aim to let you invest responsibly

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 by some funds to select stocks could keep you out of promising investments with the power to boost your long-term portfolio returns....

4 min read

Pat McKeough

ETFs

ETF providers are eager to jump on hot investor trends

Investor fads that are likely to blow over in a relatively short time will seldom be captured in an ETF. There is just not enough time for the manager to get the product to market and generate enough investor interest.

However, when fads become trends with longer expected time horizons, managers are eager to get products to waiting investors....

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.