All Things ETF

ETF Education for the Week of January 12, 2009. Indexes, Indices- their roles in ETF construction and performance By: Rick Walter Maduro, UCS Investment Co . Description : Our weekly ETF review is an education blog for investors to learn about ETF funds; how to buy or trade them; when to buy or trade them and more. ETFs are a great way to add broad based diversification and liquidity to an otherwise static portfolio and a great way to add stability to your portfolio for the long-term. Picking up where we left off- our last post was 2/23/2008 . Our last topic was Benchmarks . Our next topic is indexes, or indices . An index (a composite figure like the Dow Jones Industrial Average) becomes a benchmark index when you choose it as the standard against which to measure your own portfolio’s performance over time. Indexes provide transparency to your portfolio. You need transparency in these markets. Again the key to ETFs’ success is the broad based exposure you receive, their ability to t...

New ETFcast fund review on an ETF fund that specializes in real estate investing in the United States .

Here is upcoming podcast coverage of ETF funds by sponsor. Review dates and fund sponsors are subject to change. iShares- Barclays Global Fund Advisors - ETF review 12/15 -12/31 Oil and gas Pharmaceutical and health care Real estate Commodities Spdrs- State Street Global Advisors - ETF review 1/15-1/25/2009 Oil & gas Pharmaceutical and health care Real estate Commodities Powershares- Invesco Powershares Capital Management - ETF review 2/10 - 2/14/2009 Oil & gas Pharmaceutical and health care Real estate Commodities ETF review dates are subject to change. For a professional consultation on how ETF Funds can help you achieve your financial goals call us for a no cost consultation at 770-572-2715 or email me with your questions .

By: Rick Walter What is a benchmark and how does it help you or your ETF Fund? A benchmark is a standard against which the performance of a security, mutual fund or investment manager can be measured. Generally, broad market and market-segment stock and bond indexes are used for this purpose. For example, "when evaluating the performance of any investment , it's important to compare it against an appropriate benchmark. In the financial field, there are hundreds of indexes that analysts use to gauge the performance of any given investment including the S&P 500 , the Dow Jones Industrial Average , the Russell 2000 Index and the Lehman Brothers Aggregate Bond Index ." All ETFs are built with a benchmark in mind . Does this make ETFs easier to construct and market? Maybe, according to the total ETF funds chart I have constructed show ETFs proliferating at break neck speed.

By Rick Walter If you have not reviewed the ETF basics posts, click the ETF Shelter labels and start from the beginning. Remember, as an investor you are purchasing ETF shares in the secondary market. You are not buying creation units or any of that. Of course at some point in time I would like to start an ETF Fund and you are welcome to join my fund, then we can all buy creation units and makes lots of money hedging. However we are not there yet. Before you choose an ETF , you may want to start with some type of asset allocation model for yourself, which is the practice of dividing resources among different categories based on your risk tolerance, goals and investment horizon; Common classes for asset allocation models are Equities (stocks) , Fixed income (bonds), and Cash and cash equivalents (treasury securities); other classes of assets such as real estate are also included but can be defined in one of the three categories above. Your asset allocation model should be bui...

By Rick Walter ETF Training & presentation, education and more... There is so much out there. I went to the iShares website and found a series of educational tools, webinars, web casts , tutorials and presentations that may help a beginner and even experienced investors. I was impressed with the tutorials, but I still think that the financial buzzwords in the presentations may be a bit too complex for beginners. However, the site overall presentation and content is very good! What about taxes? By trade I am a tax professional; I believe that all investments should be analyzed first from a tax position, before an investment decision is made. ETFs are labeled as very tax efficient vehicles. Here is a good article, in my opinion, that explains the tax efficiency issue very well for ETFs. Check our external link section for links to websites that I believe provide top notch information on ETFs, including sponsors, distributors and advisers. I will be adding to the list daily. If th...

By Rick Walter An ETF , like any other type of investment company, will have a prospectus. All investors that purchase Creation Units receive a prospectus. Some ETFs also deliver a prospectus to secondary market purchasers. ETFs that do not deliver a prospectus are required to give investors a document known as a Product Description, which summarizes key information about the ETF and explains how to obtain a prospectus. All ETFs will deliver a prospectus upon request. Before purchasing ETF shares, you should carefully read all of an ETF ’s available information , including its prospectus. The websites of the New York Stock Exchange , American Stock Exchange and NASDAQ provide more information about different types of ETFs and how they work. An ETF will have annual operating expenses and may also impose certain shareholders fees that are disclosed in the prospectus. Currently, all ETFs seek to achieve the same return as a particular market indexes . Such an ETF is similar t...