Exchange Traded Funds

An ETF, or exchange traded fund, is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETFs trade like a common stock on a stock exchange and typically have higher daily liquidity and lower fees than mutual fund shares, making them an attractive alternative for individual investors. By owning an ETF, investors get the diversification of an index fund as well as the ability to sell short and buy on margin. There exists potential for favorable taxation on cash flows generated by ETFs since capital gains from sales inside the fund are not passed through to shareholders as they commonly are with mutual funds.  Please contact your Financial Advisor to determine if ETFs are right for you.