ETFs: Revolution is My Name

The exchange-traded fund (ETF) revolution is here, and I want my name to be synonymous with this rapid change.

That’s why, beginning with today’s issue of the formerly named Making Money Alert, the new name of this publication is Doug Fabian’s Weekly ETF Report.

While these changes may seem subtle to the casual reader, I assure you they are not. In fact, the changes here have big implications for every investor going forward.

You see, never before has there been as dramatic a change in the investing landscape as there has been with the explosion of ETFs. The morphing of investment pools into mutual funds midway through the 20th century is about the closest big change to the ETF revolution that I can think of, but that was many decades ago.

I am a firm believer that ETFs should be earnestly and completely embraced by all investors, hence my renewed focus on these investment tools in the Successful ETF Investing newsletter, as well as the newly named e-letter you’re reading now.

In support of the ETF revolution, I am going to use my position to convince you that ETFs are far better investment vehicles than mutual funds. Your money should be mostly invested in ETFs rather than mutual funds or individual stocks or bonds. You might say I am on a mission to persuade individual investors that ETFs are the best way to help preserve and build your wealth.

So let’s begin with a review of the top reasons why you must invest with ETFs:

1. Cost. I think investors know that ETFs are cheap. The average cost is an expense ratio of just 0.33%, which is well below the average cost of a mutual fund. Over the course of your lifetime you will save thousands of dollars in management fees by using ETFs vs. mutual funds.
2. Ease. ETFs are really easy to trade. Granted, there is a knowledge gap when it comes to buying and selling specific ETFs, but once we show you how, you’ll find it extremely easy to do.
3. Simplicity. ETFs are a simple concept. They are index based. Most investors understand the concept of an index fund. Index investing is both wildly successful and popular, and it’s also much more transparent than mutual fund investing.
4. Choice. This is perhaps my favorite feature of ETF investing, as the choices are enormous. Today there are more than 1,500 ETF choices. Of course, choice can be a blessing and a curse. However, with a little knowledge, choice becomes a very big advantage.
5. Access. Access is about more then choices, it’s about being able to invest in ways that are not available to mutual fund investors. Some examples would be single-country ETFs or commodities ETFs.

Finally, I think there is a knowledge gap here that many investors have to overcome with respect to ETFs before they can move out of mutual funds and into these superior investment vehicles. That is why, in this e-letter, we will be devoting a lot of space to helping you learn the ins and outs of ETF investing, both from a “how to” perspective, as well as a market knowledge perspective. Doing so will help eliminate any knowledge gap to allow you to be a confident soldier in the ETF revolution.