FAQs about ETFs
Q: Are ETFs guaranteed or insured?
The government agency, The Depository Trust Clearing Corporation, which ensures stock certificates are delivered to the person who bought them also, makes sure all ETF certificates in a trade are assigned correctly. Furthermore the SEC examines all applications to create an ETF. Risk of abuse is very low.
Q: Are ETFs only good for stocks?
No, they aren't only for stocks. Liquid assets of any type linked to a published index can turn into an ETF. ETFs exist for Commodities, Emerging Markets, Bonds, Foreign Currency, Latin Top 50, Japanese Futures, Basic Materials, Precious Metals, and a whole host of others.
Q: Are there international ETFs?
Of course there are. Countries in Europe and across the Pacific Rim have funds including most developed countries. As other countries gain political and economic stability they will surely adopt ETFs.
Q: Do any ETFs try to beat the market?
A fund that currently beat the market by 2 or 3xs is an actively managed fund. These funds operationally are much more difficult to manage. However it is much simpler when all players in building an ETF know the details of stock investments. Actively managed funds are traditionally more secretive, mainly to shield themselves from eager parasitical resellers.
Q: Are there ETFs for the Dow Jones Industrials or S&P 500?
Besides the S&P 500 and Dow Jones there are several funds that track those indexes. One thing people have a hard time understanding is that when trading though an ETF index the Dow Jones and S&P 500 remain in tact as their own indexes, and using a certain group license more than one fund can track an index. Start trading by opening up an account with a broker and beginning today.
Q: Could ETFs possibly be a fly-by-the-night trend or fad?
It's very unlikely it's just a fad. By the end of 2009 assets of exchange traded funds totaled and astounding $656.91 billion. Year over year the steady growth of ETFs has been stronger and more consistent than other financial products. Mutual funds haven't even seem the same growth ETFs have experienced. - 23210
The government agency, The Depository Trust Clearing Corporation, which ensures stock certificates are delivered to the person who bought them also, makes sure all ETF certificates in a trade are assigned correctly. Furthermore the SEC examines all applications to create an ETF. Risk of abuse is very low.
Q: Are ETFs only good for stocks?
No, they aren't only for stocks. Liquid assets of any type linked to a published index can turn into an ETF. ETFs exist for Commodities, Emerging Markets, Bonds, Foreign Currency, Latin Top 50, Japanese Futures, Basic Materials, Precious Metals, and a whole host of others.
Q: Are there international ETFs?
Of course there are. Countries in Europe and across the Pacific Rim have funds including most developed countries. As other countries gain political and economic stability they will surely adopt ETFs.
Q: Do any ETFs try to beat the market?
A fund that currently beat the market by 2 or 3xs is an actively managed fund. These funds operationally are much more difficult to manage. However it is much simpler when all players in building an ETF know the details of stock investments. Actively managed funds are traditionally more secretive, mainly to shield themselves from eager parasitical resellers.
Q: Are there ETFs for the Dow Jones Industrials or S&P 500?
Besides the S&P 500 and Dow Jones there are several funds that track those indexes. One thing people have a hard time understanding is that when trading though an ETF index the Dow Jones and S&P 500 remain in tact as their own indexes, and using a certain group license more than one fund can track an index. Start trading by opening up an account with a broker and beginning today.
Q: Could ETFs possibly be a fly-by-the-night trend or fad?
It's very unlikely it's just a fad. By the end of 2009 assets of exchange traded funds totaled and astounding $656.91 billion. Year over year the steady growth of ETFs has been stronger and more consistent than other financial products. Mutual funds haven't even seem the same growth ETFs have experienced. - 23210
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