Listen to The ETF Store Show every Tuesday at 9am on ESPN 1510 as we cover everything you need to know about Exchange Traded Funds and the world of investing.
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On our most recent radio broadcast, we discussed last week’s big announcement from Fidelity regarding their expanded commission free ETF platform. Fidelity is now offering 65 iShares ETFs commission free. This comes on the heels of Charles Schwab’s recent launch of “Schwab ETF OneSource”, a new ETF platform offering 105 commission free ETFs. TD Ameritrade also offers 100 commission free ETFs. For all of the potential benefits that ETFs can provide investors – from lower costs and greater tax efficiency, to more transparency and better diversification – one knock has always been trading commissions. Since ETFs trade on the exchanges, just like individual stocks, investors typically must pay a trading commission when buying or selling shares. However, moves like the ones we’ve seen recently from Schwab and Fidelity continue a trend that we believe is just getting started. We expect to see more ETFs move to commission free trading, providing investors yet another reason to consider using ETFs in their portfolios. In addition to our discussion on commission free ETFs, we also spent some time explaining how investors can leverage the potential benefits of ETFs in various types of retirement accounts including Traditional IRAs, Roth IRAs, SEP IRAs, and even company 401k plans.
In our weekly market update, we discussed the two biggest concerns we’re hearing from clients as it relates to their investments and the financial markets. We offered some thoughts on how investors can tackle these two primary concerns and where ETFs fit into the picture. Finally, in our ETF spotlight segment, we examined a very interesting sector ETF – the SPDR S&P Homebuilders ETF (ticker XHB). While the homebuilding sector and related segments experienced sharp declines in 2007 & 2008 with the popping of the housing bubble, signs of a housing recovery propelled this ETF to a 57% return in 2012. We explained what might be next for the homebuilder sector and this particular ETF.
