By Thomas Coyle September 15, 2017
ETFs and index mutual funds are all the rage. Credit Suisse says ETFs have gone from essentially nowhere in 2000 to about 30% of U.S. securities trading by dollar value and over 20% by share volume last year. Meanwhile financial advisors say these passive investment vehicles have also altered the way they relate to their clients, particularly around fundamentals like value and risk.
Talking to clients about ETFs is “easy because of their benefits” in pricing and transparency, says Paul Tramontozzi of KBK Wealth Management in New York.
The pricing advantages of ETFs seem clear enough. At the start of 2016, the average passive mutual fund — which, like ETFs, track indexes, sectors or