ETF Expense Ratios

The following ETFs have been analyzed by S&P Capital and are rated as good buys determined by the single stocks they include. These are based upon valuation and risk perspectives, not the expense ratio alone:

  • First Trust Healthcare AlphaDEX Fund (NYSEArca: FXHexpense ratio 0.70%
  • SPDR Russell 1000 Low Volatility ETF (NYSEArca: LGLVexpense ratio 0.20%
  • Health Care Select Sector SPDR (NYSEArca: XLVexpense ratio 0.18%
  • First Trust ISE Cloud Computing Index Fund (NYSEArca: SKYYexpense ratio 0.60%

The cost of owning an ETF is not a simple glance at an expense ratio. There are plenty of other factors to consider that go beyond the ETF fee war. [Cheaper ‘Core’ iShares ETFs off to Fast Start]

“There are other implicit transaction costs to consider. For example, investors also should assess bid/ask spreads before buying and selling shares of an ETF. As a general rule of thumb, ETFs with large asset bases and high trading volumes generally will have lower bid/ask spreads than smaller ETFs with lower trading volumes,” Timothy Strauts wrote for Morningstar. [Index Hugging Mutual fund Shamed by Cheap S&P 500 ETFs]

Tisha Guerrero contributed to this article.