Search

The article focuses on the recovery of the exchange-traded fund (ETF) industry in the U.S. Data from the Investment Company Institute (ICI), a national association that represents U.S. investment companies revealed that growth was distributed throughout the domestic industry with an increase in broad-based and sector equity funds, international funds, and bond funds. It notes that iShares MSCI Emerging Markets Index (EEM) remained the top ETF in international and emerging markets.

The article reports on the continued growth of U.S.-based exchange-traded funds (ETF) as of 2008. The growth of ETF into a spectacular array of divergent choices is evidenced by the inclusion of leveraged portfolio, funds tracking fundamentally weighted indexes and actively managed funds. Among the factors that contribute to the popularity of ETF are trading flexibility and the fund's low cost structure.

The article focuses on the drawbacks of short and leveraged exchange traded products (ETPs). Short and leveraged ETPs have experienced tremendous growth in the past few years. In the U.S., some ETPs have not performed in line with the exchange traded funds' (ETFs') stated investment objective. The main issue with U.S. listed ETFs is that the derivative counterparty does not guarantee the daily index closing price and aims to provide a return as close as possible on a seek to achieve basis.