Do ETFs Belong in Your Portfolio?

Posted on 6-24-2020

Investor demand for exchange-traded funds (ETFs) has increased over the last decade due to some attractive features that set them apart from mutual funds.

At the end of 2019, almost $4.4 trillion in assets was invested among 2,096 ETFs. This is equivalent to more than 20% of the assets invested in mutual funds. In 2009, ETF assets were equivalent to only about 7% of mutual fund assets.

This week, Craig Siminski, of CMS Retirement Income Planning,  shares an article discussing the potential benefits and risks of exchange-traded funds and how they differ from mutual funds:

Like a mutual fund, an ETF is a portfolio of securities assembled by an investment company. Mutual funds are typically purchased from and sold back to the investment company and priced at the end of the trading day, with the price determined by the net asset value (NAV) of the underlying securities.

By contrast, ETFs can be traded throughout the day on stock exchanges, like individual stocks, and the price may be …

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Craig Siminski is a CERTIFIED FINANCIAL PLANNER™ professional, with more than 22 years of experience. His goal is to provide families, business owners, and their employees with assistance in building their financial freedom.

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