Tim Meyer, ETF (exchange traded fund) business manager for Rydex Investments spoke with Robert Keane of Investment Advisor and gave some advice about investing in these funds.To begin with, when one is looking for an ETF, they should consider the underlying index and how it is constructed, the methodologies used, and the benchmarks. To decipher ETFs, it is helpful to assess risk characteristics, good diversification, and have a broad based portfolio.

New types of ETFs are crossing over into areas that were not accessible before, such as currencies and commodities. The effect ETFs have had on the mutual fund business isn’t great. There are more choices and more money going into ETFs instead of mutual funds, according to Meyer, the growth is only in dollars and not percentages.

Read the disclosure, as Tom Lydon is a board member of Rydex Funds.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. 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.

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