Not only was he saving his clients money, the index-tracking ETFs performed better as well, he said.
These include low cost index-tracking choices for those who do not think that they can pick a better-than-average investment manager.
Traditional mutual funds tend to be actively managed, while ETFs adhere to a passive index-tracking strategy, and therefore have lower expense ratios.
Approximately 60 percent of the allocation is already managed in passive index-tracking portfolios and the remaining 40 percent is managed externally by active investment management firms.
That was especially the case in commodities markets, where selling by index-tracking ETFs would be instantly visible to traders, unlike harder to spot sales of bullion.
He switched to ETFs in 2006 because these index-tracking products have lower expense ratios than the traditional mutual funds that try unsuccessfully to beat the market.
The academic concept of efficient market theory that prices already reflect all available information has led to the creation of index-tracking funds that allow investors to own a diversified portfolio at very low cost.
The index tracking leveraged-loan trading fell 6% over the last three months, an indication that the weakening credits will force banks to write-off a chunk of their exposures.
So these managers eschew the passive approach to tracking an index in favor of a semi-active approach to portfolio management.
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After closely tracking the Employment Cost Index for a quarter-century, compensation levels in the All Volunteer Force exploded over the last ten years.
The Index is a rules-based, modified global-capitalization-weighted, float-adjusted index intended to give investors a means of tracking the overall performance of a global universe of listed companies engaged in the solar energy industry.
The most recent update to the Index shows the sharpest year-to-year rise in clean-energy patents since Heslin began tracking clean-energy innovation trends in 2002.
However, as index-based mutual funds and ETFs continue to gain popularity and active managers are increasingly pressured to control their performance tracking error relative to benchmark indexes, the markets could become less efficient.
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