Exchange traded funds (ETFs) are a basket of stocks that trade throughout the day, have low management fees and give investors access to areas, such as commodities, once available only to seasoned investors. Walter Hamilton of The Chicago Tribune adds that assets jumped 43% last year alone, to $432 billion, and the number of ETFs went from 51 to 380.
This show of good reliability and high performance has led many financial services to try and adapt ETFs to 401K retirement plans. The main drawback is the ETFs structural impediments such as trading times and brokerage fees for automatic investing. Some companies have come forth with ways to use ETFs in the plans and others are working to make it more readily available and mainstream.
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.