Exchange Traded Funds (ETFs)
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With exchange traded funds from Fifth Third Securities, you can diversify your portfolio while enjoying the ease of exchange trading. If you’re ready to add ETFs to your investment portfolio, a Fifth Third Financial Professional can help you get started.
Advantages of ETF Investment
Lower cost: ETFs often have lower investment minimums and lower fees than mutual funds.
Less risk: Because exchange traded funds are a collection of stocks or bonds, if a single stock or bond performs poorly, your losses are minimized thanks to the strength of the other assets in the collection.
Diversification: ETFs allow investors to easily invest in broad market verticals, as well as industry horizontals.
Liquidity: ETFs offer the freedom to trade during trading hours, unlike mutual funds which can only be traded within 24 hours.
Tax efficiency: Typically, ETFs are only taxed when the investment is sold, while mutual funds are taxed much more frequently.
What is an Exchange Traded Fund?
To put it simply, an ETF combines the best of two worlds: mutual funds and stock trading. Like a mutual fund, an ETF is a collection of stocks, bonds, and other assets, and shareholders own a portion of the ETF. And similar to stocks, ETFs are traded on an exchange and can be traded throughout the day, which means they experience price changes throughout the day, too.
How Exchange Traded Funds Work
ETFs may provide a lower cost way to gain exposure to specific asset classes, geographic regions, and other targeted investment areas. They trade like stocks with the ability to buy and sell, with prices adjusting throughout the trading day. A Fifth Third Securities Financial Professional can help you determine whether ETFs make sense for your investment portfolio.
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