During the past few years, a number of young start-up companies set up shop to sell exchange traded funds (ETFs). But the turbulent stock market of late is making a mess of these small companies, who would eventually sell their product to a larger company.

Because of the volatile market, many investors are dodging the new ETFs and taking to the ETFs that have been around, reports Diya Gullapalli for The Wall Street Journal. Market instability mixed with a possible economic slowdown are keeping these smaller companies from garnering any assets and building a track record. In 2007, more than 260 ETFs launched and 110 of them were in the red as of today.

Despite the struggles for new ETFs, positive points within the ETF industry remain. Average daily trading volume is still climbing, and overall assets are up 40% last year through November. Certain areas of the ETF market are taking off, too, such as municipal bonds and fixed-income funds.

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.

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