actively managed ETF - or investing in the stock marketactively managed ETF - can be low risk An actively managed ETF is an exchange trade fund that is managed by a fund manager or a group of people. An Exchange trade fund is a fund that is literally traded much like stocks and bonds. The advantage to a supposedly managed ETF is that they will decide how to keep risk low and will take the time that you would have to take to buy assets that give investors the best return. Many times the managers will choose sectors of a market in order to try and beat most market indexes. There are many risks associated with ETF’S that are managed due to the fact that the holdings can change very fast without the investor’s knowledge. Worse yet most managed funds do worse than the S&P 500 in the long run and most investors are not aware of that this phenomenon. gold investing onlineComments:In general though ETF’S have the potential become less risky investments due too the fact that they usually hold a diversified amount of assets, and better yet they trade like stocks so you won’t have to face the same tax penalties’ that you normally would buying regular mutual funds or other types of a multiple investment schemes built into one. You need to think about what market sector you are buying the MOST of when you buy into an ETF fund. Depending on the economy and the current state of things certain sectors will do better than other sectors. For instance say that the economy is going down and the price of gold is going up really quickly, you then might want to invest in companies that do mining since the goods that they will create are worth MORE than they currently were in the past. One of the things to look at in any given market sector and actively managed ETF sectors is whether or not what they are selling is going up or down in price. ETF’S that focus on the dairy industry should NOT be bought until you first have a good idea of where the price of dairy products is going for example. |