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Wind ETF Good Investment?

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An article by Tim Beyers from a few years ago asks some very good questions with regards to focused ETFs such as the Wind ETF that I mentioned on 5/28. The key points can be quickly summarized as:

  1. Know the composition of the security. Are there companies held by the ETF that are bleeding money like a sieve?
  2. What is its expense ratio? With index investing, ETFs are great because the indexes are reallocated electronically, so the expenses are low. In other words, you’re not paying an expert to throw his darts at the board instead of yours.
  3. Who runs the ETF? Are they reputable/trustworthy? There’s nothing worse than giving your money to some dunce.

As a rule of thumb, any investor should be using this advice for any investment. You don’t want to risk your money without balancing it with a reasonable chance of earning a return on that risk. Otherwise, you may as well head to the card table at your local casino.

Read Beyer’s entire article here.


Written by walonline

June 8, 2008 at 8:06 am

Posted in Investing, Markets

Tagged with , , ,

One Response

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  1. […] thank you to all the visitors looking at my posts on ETFs (especially here and here). If you have any questions, comments or ideas to add to the discussion, please offer them […]

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