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
Growth stocks can boost your gains
Growth stocks can be riskier than well-established firms, but the best of them often make good long-term investments. They may be well-known stars or quiet gems, but they do share one common attribute: they grow at a faster-than-average rate within their industry, or within the market as a whole, for years or decades.


Here we look at two ETFs that select growth stocks from the U.S....
3 min read
Scott Clayton
ETFs
Wait and see with China
ISHARES CHINA LARGE-CAP ETF, $46.96, 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 are charged a high 0.74% MER. The units yield 2.4%.


Top holdings for the $3.4 billion fund are Meituan Dianping (group buying/food delivery), 10.3%; Tencent (Internet), 9.9%; China Construction Bank, 8.7%; Alibaba (e-commerce), 6.4%; Ping An Insurance, 4.6%; Industrial & Commercial Bank, 4.5%; Wuxi Biologics, 3.9%; and Xiaomi (smartphones), 3.8%.


China now appears to have COVID-19 increasingly under control, and has steadily reopened its economy....
1 min read
Pat McKeough
ETFs
Six top international ETFs for future gains
All of the major global stock markets fell in the wake of COVID-19’s spread. But many top markets have since rebounded. We think the outlook remains positive for quality stocks, and one way to profit, 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
You should be prepared for higher inflation may be on the way
The U.S. Federal Reserve recently announced that it is, under certain conditions, prepared to let inflation run well above its long-established target of 2%. The decision implies that U.S. interest rates will remain low. And, in fact, a recent survey of Fed officials showed the group expects rates to remain at or near zero through 2023.


Most of the other major central banks, including the Bank of Canada, plan to keep interest rates low for a long time even if inflation starts to rise....
3 min read
Pat McKeough
ETFs
Here are good and bad ways to cut risk
Diversification is a key way to reduce portfolio risk and volatility, but there are other strategies aimed at cutting portfolio risk and volatility. Those other methods include moving investments into risky assets at regular intervals and buying stocks gradually over time....
2 min read
Pat McKeough
ETFs
Stocks pulled back in September
The month of September saw declines in equity markets after significant gains over the previous six months. At the broad market level, the Vanguard Total World Stocks ETF (VT) lost 4.0% month over month, the Vanguard S&P 500 ETF (VOO), 4.5%, and the iShares MSCI Canada Equity ETF (EWC), 5.3%....
1 min read
Pat McKeough
ETFs
These ETFs use a ‘black box’ to pick stocks
Some ETF managers were quick to establish ETFs that benefit from changes in consumer behaviour during the COVID-19 pandemic. Here’s a look at two of them:


The DIREXION WORK FROM HOME ETF $56.36 (New York symbol WFH) aims to provide investors with diversified exposure to firms involved in cloud technologies, cybersecurity, online project coordination, document management, and remote communications.


These companies can be located anywhere in the world, but over 90% of the portfolio is currently invested in U.S....
2 min read
Pat McKeough
ETFs
Fiscal and monetary tools have helped offset COVID-19
Canada continues to deal relatively well with the COVID-19 pandemic compared to its southern neighbour. To date, the infection rate and deaths as a percentage of the total population have been much smaller than those in the U.S.


This is in part because the Canadian government acted aggressively to counter the economic impact of the COVID-19 pandemic and keep workers at home.


Key tax and spending measures amounting to $317 billion (or 15% of GDP) include: $20 billion to the health care system to support increased testing, vaccine development and medical supplies; $212 billion in direct aid to households and firms, including wage subsidies, payments to workers without paid sick leave and access to employment insurance, and an increase in existing GST tax credits and child care benefits; plus $85 billion in liquidity support through tax deferrals.


Central banks around the world have rushed to help soften the blow to economic activity caused by the COVID-19 pandemic....
1 min read
Pat McKeough
ETFs
Canada’s stock market has great potential
The Canadian economy ranks among the top 10 globally and has performed better than most of its large, developed peers over the past decade. The country is also among the top 15 most-competitive economies in the world; to date, it has fared relatively well at containing the COVID-19 pandemic....
4 min read
Pat McKeough
ETFs
These ETFs could help you beat inflation
While inflation remains very low, conditions for an eventual uptick may well be building. Those factors include today’s very low interest rates, massive government spending and borrowing to inject money into the economy, growing import barriers, and the higher cost of doing business in a pandemic....
5 min read
Pat McKeough
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