ETFs now account
for a third of all index fund assets, up from 9%
in 2000. The Wall Street Journal reports that "in less than three years, the total number of ETFs has jumped
nearly 70 percent, to 185, while the number of index funds has remained
relatively flat. ETFs have even started popping up in 401(k) plans."

A key driver in the popularity of ETFs is the failure by many
mutual-fund managers to beat the market for extended periods of time,
even as they collect big management fees. Instead, many advisers have
turned to a strategy of lower-cost index funds, and increasingly, ETFs.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.