Many investors seem divided about whether leveraged and inverse ETFs are deserving of the scrutiny and criticism they’re receiving, but our poll results show that most of our readers feel that the ETFs should be left alone and investors should be free to make their own decisions.

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Rick, an ETF Trends reader, left a comment on the poll in defense of the funds:

Nobody is forcing anyone to use them against their will. And I say this even though my last trade (FAZ) was a big loser. Hey, you can’t win them all. When the opportunity is right (for me), I plan to use a leveraged (or inverse leveraged) ETF again.

A similar poll conducted by Ignites showed results that were somewhat in line with our own. In their poll, 51% of respondents said that that regulators weren’t justified in singling out the funds. 27% said they were justified, and 23% said that they were justified, but that other financial products needed scrutiny, as well.

For more stories about leveraged and inverse ETFs, visit our long-short ETF category.

The Ignites survey found that most respondents believe that fund families will need to include an ETF in their offerings to remain competitive. Greg Schoulas for Ignites reports that about 61% of respondents said that having no ETF products will be a marketplace liability for investment companies.

Other findings include:

• 33% said fund companies will definitely need ETFs in the future, but not necessarily right now;
• 28% said ETFs are currently needed to maintain a manager’s marketplace standing;
• 39% believe investment companies do not need an ETF to be competitive

Fortunately, major industry players appear to be realizing the importance of expanding their offerings to include ETFs. There are many mutual fund companies looking to get in who, just three years ago, would never have imagined adding ETFs to their lineup.

Charles Schwab is stepping into the game with three foreign funds as well as offerings that track the broad U.S. equity market, large-cap stocks, large-cap value, large-cap growth, mid-cap and small-cap. Fixed-income giant Pimco and iShares buyer BlackRock are also joining in the fun.

These are some really big names, and we think it’s just the beginning. The ETF industry is going to look really interesting before long.

The survey by Ignites was an unscientific sampling of their audience. 331 individuals voted on a voluntary basis.

If so, please take a look at the following questions:

• Do you have any stories to share with us about either your success or misfires? What have been your biggest challenges?
• What strategies do you use? Do you use the 200-day moving average? How has it worked for you?
• How much time each month do you spend on researching and tracking your portfolio and what’s in it?

If you have any thoughts or experiences to share regarding managing your own portfolio, please leave your thoughts in the comments or shoot us an email.

For this round, we’d like to know about your experiences in past bear markets. Some things we’d like to hear about from you include:

• What has been your strategy in past bear markets? How did it work for you?
• During the bull years, did you make money and keep it? How did you do it?
• Were you invested in other countries during their boom and busts? (Emerging markets, Japan, etc.) What happened to your investments?
• In the commodities rush of 2008, did you buy gold or oil? Do you still own either of them, and do you have a sell point?
• Were you able to foresee the crumbling of the real estate market? What were your clues? What, if anything, did you do?

If you have any thoughts to share regarding bear markets, bursting bubbles and similar matters, please leave your thoughts in the comments or shoot us an email.

If so, we’re interested in talking to you for a story about your experiences.

If you’d like to chat for a few minutes, please leave a comment below or email us at tlydon@globaltrend.com, and we’ll get back to you!

Matthew Hougan for Index Universe shows evidence that investors seem to overlook expenses:

• iShares MSCI Emerging Markets (EEM) has an expense ratio of 0.74%. It currently has $24 billion in assets. Vanguard Emerging Markets (VWO), which is a competing fund, has a 0.30% expense ratio with a strong performance record, but has a smaller $6 billion in assets. 
• Another case in point: Mid Cap SPDR (MDY) tracks the S&P 400 and charges 0.25% in expenses, with $8.2 billion in assets. iShares S&P 400 MidCap (IJH) charges 0.20%, tracks the same index and has $4.4 billion in assets.

This may be a case where the ETFs with the greatest assets in each category are also the first ETFs to hit the market, since this is the case in these examples.

Another clue Hougan cites as evidence that investors might not care much about expense ratios is that, with some exceptions, fund companies generally don’t market toward it. Some ETFs are launching today with fees of 0.70% or more.

Do investors know, but just not care? Perhaps. Expense ratios are just one factor in the equation. Spreads, in some cases, can outweigh any advantage a low expense ratio might offer.

It doesn’t seem a lack of understanding as far as ETFs go is the problem. A survey we summarized yesterday reported that of the investors who participated, 16% use ETFs. A large portion of these ETF users, 87%, said they understood how fees impacted their returns.  This was quite different compared to all the survey respondents; 88% felt fees for the fund industry overall were unclear.

Which single ETF feature is most important to you among the following? Expense ratio, brand name, past performance or assets under management? Feel free to answer in the comments!

So, could we have two minutes of your time?

Please click here to take the survey.

In a distant second were the long/short ETFs. Tied for third were currency and precious metals. And tied for fourth was commodities and the plain vanilla funds (such as SPY).

Thanks for playing!