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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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ETFs Library Archives

ETFs

ETFs for income—and growth

Investors looking to generate current income from their stock portfolios typically start by looking for the highest-yielding shares. However, exceptionally high yields can be a sign of trouble ahead—they can signal imminent dividend cuts. One way around that risk is to invest instead in stocks (or ETFs that hold them) with solid, sustainable dividends....

3 min read

Pat McKeough

ETFs

China’s recovery continues

ISHARES CHINA LARGE-CAP ETF, $45.80, is a hold for safety-conscious investors. The ETF (New York symbol FXI; buy or sell through brokers) tracks the 50 largest, most-liquid Chinese stocks. Investors pay a high 0.74% MER. The units yield 2.2%.

Top holdings for the $4.5 billion fund are Tencent (Internet), 9.2%; Alibaba (e-commerce), 9.2%; Meituan Dianping (group buying/food delivery), 8.6%; China Construction Bank, 5.4%; JD.com (e-commerce), 5.0%; Wuxi Biologics, 4.6%; Netease (Internet), 4.0%; Ping An Insurance, 4.0%; and Industrial & Commercial Bank, 3.8%.

Despite the new Democrat-led administration in the U.S., uncertainty over the China-U.S....

1 min read

Pat McKeough

ETFs

Six top international ETFs: 4 buys, 2 holds

All of the major global stock markets fell at the initial outbreak of COVID-19. But many top markets have since rebounded. We think the outlook remains positive for quality stocks, and one way to profit from that—while cutting your risk—is to invest in quality ETFs.

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

7 min read

Pat McKeough

ETFs

Renewable energy: Still lots of room for gains

When we last wrote about this topic in mid-2018, the conclusion was that the share of renewable energy was growing rapidly. That reflects government-driven efforts, especially in Europe, the U.S. and Canada, to expand renewable capacity.

Demand is also strong from power-using corporations, looking to increase their green footprints—in part to please shareholders....

2 min read

Pat McKeough

ETFs

REITs are bouncing back from COVID

Investors who owned marijuana or energy stocks in the first quarter of 2021 saw considerable gains for these investments. Other big winners in the first quarter were U.S. homebuilders, value stocks, financials, agricultural equities, and mid- and small-cap stocks.

Stocks had another good quarter....

1 min read

Pat McKeough

ETFs

Investing for children can include ETFs

Taking the time to pick the right investments for children and grandchildren is a worthwhile endeavour. Here’s a look at two aspects of an investment program for children.

First are the administrative aspects of setting up the investment program. If the child is under the age of 18, she or he cannot yet invest as an adult; however, there are savings and investment options available.

Second is the time horizon for investing for children....

2 min read

Pat McKeough

ETFs

Two new ETFs for Canadian investors

This month we look at a new ETF from BMO that aims to capture “megatrends.” We also analyze an ETF that aims to pick winning stocks based on the social media attention these stocks receive.

The BMO MSCI INNOVATION INDEX ETF $29.36 (Toronto symbol ZINN), covers four different trends, namely genomics, fintech, next generation Internet, and industrial innovation....

1 min read

Pat McKeough

ETFs

Dubai’s buildings help fuel the UAE’s tourism push

The landscape of Dubai features numerous architectural masterpieces and increasingly draws the kind of related tourism of a Chicago or San Francisco. The Burj Al Arab, a famous 7-star hotel where rooms normally sell for more than $1,500 per night, is but one example (see picture pg....

1 min read

Pat McKeough

ETFs

There are no bargains in hedged ETFs

Investors in Canadian-listed ETFs with non-Canadian international holdings effectively gain exposure to the currencies of the countries where those holdings are listed.

Investors in unhedged ETFs with foreign exposure will receive the foreign currency gains on the underlying securities, expressed in Canadian dollars....

1 min read

Pat McKeough

ETFs

Tap the UAE for oil gains, and increasingly more

The United Arab Emirates is a small country in a potentially volatile region, with neighbours like Yemen and Iran nearby. Still, it has used its oil riches wisely to diversify the economy and become a major commercial hub in the Middle East.

Here’s an ETF that provides exposure to the top companies listed in the UAE.

ISHARES MSCI UAE ETF $13.42 (New York symbol UAE; TSINetwork ETF Rating: Aggressive; Market cap: $27.9 million) tracks the performance of the largest publicly listed UAE companies.

Financial Services account for 51% of its assets, while Telecommunications (15%), Real Estate (14%), Industrials (10%), and Energy (5%) are other key segments.

The ETF has a portfolio of 32 stocks; the top 10 holdings make up a high 72% of its assets....

5 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.

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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.