ETF Flexibility: The Advanced Yoga Class of Investing | ETF Trends

The allure of an all-exchange traded fund (ETF) portfolio is appealing to many investors. With more than 500 different products available on the market, a well-diversified approach using only ETFs is possible. ETFs are popular with do-it-yourself investors and professional money managers alike. They like that the products can cut down "bleeding" during down times and amp up returns during market rebounds, reports Rob Wherry for The Wall Street Journal. Along with tax advantages and low costs, ETFs are based upon published indexes available in real time so investors know exactly what they’re getting.

An adviser can fill out a client’s asset allocation plan where it’s needed or plug small cracks  in a portfolio with the narrowly-focused ETFs. ETFs hold multiple stocks, so it helps reduce the risk and volatility of a single stock pick. ETFs also can help investors get in and out of aggressive positions; they have no investment minimums or penalties for brief holding periods except brokers’ fees. With flexibility like that, an all-ETF portfolio can bend to meet almost every investor’s needs.

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.