Everything’s more expensive these days and we’re all sick of being nickeled and dimed to death with random, surprise fees. This frustration has led to the success of exchange traded funds (ETFs), and they’ve changed the way advisors do business.
A study conducted in March by State Street Global Advisors confirmed that advisors love the low-cost, fee transparency and tax efficiencies that ETFs offer. This has led to 76% of the 840 investment professionals surveyed saying they believe the funds fit well in fee-based accounts.
I spoke with Mariana Lehmann for Ignites earlier this week about the issue. I’ve been a fan and proponent for ETFs for years now, and it’s exciting to see them taking off the way they have. They simply offer too much for investors to ignore them.
ETFs are slowly moving into the mainstream. Matt Hougan for Index Universe says that at conferences a mere five years ago, you’d ask who uses ETFs and one or two hands would go up. Today, it’s pretty much the entire room.