By Solomon G. Teller, CFA, Chief Investment Strategist, Green Harvest Asset Management
Last week, JP Morgan made waves by announcing plans to convert four of its mutual funds into ETFs. In line with generally declining ETF fees, JP Morgan will also lower the converted ETFs’ costs. JP Morgan’s move follows DFA’s recent and largest conversion, and Bloomberg predicts $1 trillion in total will occur over the next decade. And although the rest of the world has been slower than the U.S. in embracing passive investing, there are signs of that apparently changing.
This trend offers investors even more opportunities for constructing efficient, after-tax oriented portfolios that also capitalize on the many benefits that ETFs offer, such as transparency, intraday liquidity and tax efficiency. Undoubtedly, ETFs will play a more prominent role in helping investors achieve their financial goals.
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Performance quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, so you may have a gain or loss when the portfolio is liquidated. Current performance may be higher or lower than that quoted. Performance of an index is not illustrative of any particular investment. It is not possible to invest directly in an index.
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