As we mentioned in the ETF (exchange traded fund) Trends for 2007, mutual funds, oddly enough are increasingly investing in ETFs. According to the fund tracker Morningstar, there are 39 funds that invest at least 80% in ETFs, reports Jen Ryan of TheStreet.com. Along with being tax efficient, diversified and transparent, an ETF lets you roll in and out of market segments in an easy and cost effective way. The Huntington Rotating Markets Fund (HRITX) is geared for retail investors and has $50 million in assets and rotates between 4 segments: U.S. Large-Cap stocks, U.S. Mid-Cap stocks, U.S. Small-Cap stocks and global. ETFs allow the fund to rotate segments easily.
AdvisorOne‘s five mutual funds also invests almost entirely in ETFs. Flex-funds Aggressive Growth (FLAGX) also invests in ETFs, while Seligman has target-date funds that are crossing over into 401K plans. Target-date mutual funds of ETFs are becoming more insurgent into the market, expect to see more in registration soon.
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.