Tuesday, June 19, 2012

Using ETFs During Times of Turmoil

There might be more volatility ahead as the market faces potential regulatory reform and the growing sovereign debt crisis. ETFs are supported to make investors’ life easier. However, since the first ETF - SPDRs (SPY) - was created in 1993, there are more than 847 ETFs in the market today and they are still growing.

Number of New ETFs Created by Year

The following chart shows how the number of ETFs mushroomed in 2006 -2008 bull market.

ETF Fund Families’ Market Shares

The $743 billion ETF market is dominated by 3 major fund families: iShares, SPDR and The Vanguard Group. Their market shares (by net assets) are shown below:

Top 3 ETFs of 3 Major Fund Families

If you are index investors, the following top ETFs from major fund families should give you all the diversifications you need:

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