One issue that ETF providers have that mutual fund providers don’t is that mutual fund issuers have a better understanding of who their shareholders are. Because ETFs trade on exchanges, there’s not as much information available to the providers, so studies like this are very key when it comes to getting insight into who, exactly, is putting ETFs to work in their portfolios.
Providers have done a great job of educating investors and working with advisors who use ETFs in their practices. What we’ve found, though, is that there is a huge amount of self-directed investors who make their own decisions and have made a major shift into ETFs. Most of our readers here on ETF Trends are self-directed investors who are highly educated (nearly 45% have an advanced degree) and most of them use the internet for all of their investing research.
ETFs are a great tool for anyone, and it’s thrilling to see the way they’ve caught on with everyone from institutional investors on down to the retail investor.
For more information on ETFs, visit our ETF 101 category.
Max Chen contributed to this article.