ETF Insights blog

How seemingly similar index ETFs can have crucial differences – and how you can spot them

This series of articles, “Solving your investment problems,” will explore advisors’ and investors’ key concerns and suggest some of the best solutions for each one.

How seemingly similar index ETFs can have crucial differences – and why it matters

Mackenzie has just released its 2021 mid-year ETF report, entitled, “Top ETF trends for a post-pandemic world”.

With Canada’s population aging at a rapid rate and demographics shifting, having enough income in retirement is becoming a key concern for investors.

Most investors’ portfolios contain core holdings, which track markets and typically aim to bring in consistent returns. One example of this would be a Canadian equity index fund. However, core holdings often provide returns that are close to the markets’ overall performance.

We often hear that you should invest in what you know – Warren Buffet is a high-profile exponent of this advice. However, over-investing in sectors we’re comfortable with can be very risky to our financial health.

DIY investors hit the headlines in a big way in early 2021 when a group of them caused several stocks (such as GameStop) to have massive volatility.

This series of articles, “Solving your investment problems,” will explore those key concerns and suggest some of the best solutions for each one.

While many economists are predicting a year-over-year increase in inflation, the consensus being that long-term inflation will remain subdued and will not continuously exceed the 2% long-term target.

Advisors and investors have a variety of concerns when it comes to growing wealth. Today’s financial markets bring several key challenges that investors didn’t have to worry about 20 years ago.

While emerging markets bonds had a bumpy ride in 2020, they did end the year in positive territory. With yields expected to remain near record lows across most developed markets, investors looking for better-than-average yield are likely to turn to emerging markets bonds, boosting investment in this segment in 2021.

Over the past 12 months, several trends have emerged in the ETF marketplace that have played a large part in fuelling the huge growth in ETFs in Canada.

Eleven Mackenzie Investments funds have been recognized for their industry-leading performance at the 2020 Fundata FundGrade A+® Awards.

The events of last year shook almost all aspects of our lives - and it was no different for the financial industry. The volatility we saw in the market last year became a growth factor for the ETF industry.

As we prepare to bid farewell to 2020, a year for many reasons the world would like to put behind us, our ETF experts share their top investor takeaway as a year in review.

It could be argued that diversification matters more to successful investment outcomes than ever before. The concept of diversification is straightforward: investors can reduce portfolio risk by including uncorrelated securities without reducing expected returns.

Joe Biden has been elected the 46th President of the United States, but the Blue Wave implied by pre-election polls did not come to pass. Democrats hold a narrower majority in the House of Representatives and Republicans appear likely to maintain their Senate majority.

Many investors are good at stock picking across the spectrum of market capitalization in both Canada and the U.S. There is still more diversification work and education to do!

As the Covid-19 pandemic continues to negatively impact the global economy central banks are forced to keep interest rates near zero.

Unprecedented government budget deficits remain essential to underpin the fragile economic recovery from the pandemic.

Asset allocation is essential for investors looking to maximize their growth potential, while managing risk. It can account for up to 92% of the variation in a portfolio’s returns.

As we move through the various stages of the pandemic, investors want to know what will happen in the economy and markets.

Over time, the market itself will move a portfolio’s asset allocation away from its intended mix.

Money changes hands, often. And new money comes into play, hopefully just as often.

As central banks around the world focus on supporting the economic recovery, the risk-free yield on holding cash has declined to near zero. Falling risk-free interest rates tend to increase the fair value of other asset classes.

As the ETF industry sees strong inflows through the 2nd half of 2020 and markets continue to trend in the right direction, Mackenzie Investments surpassed $7 billion in ETF assets on July 29, 2020.

With the expected ongoing growth of the ETF industry, investors and fund providers should welcome the continued scrutiny by regulators across the globe.

ETF flows suggest Canadian investors have been slow to embrace the recovery that has taken place in emerging markets.

I recently had the opportunity to present to Do-It-Yourself (DIY) investors at a recent conference event . I present some highlights below.

Fund providers are in the business of trust, and the monetization of trust is changing.

ETFs are the fastest-growing segment of the asset management industry and this momentum shows no sign of dissipating moving forward.

In this rapidly evolving market environment, investors need a modern approach to asset allocation.

Over 80% of advisors surveyed in North America now use ETFs. This number has more than doubled in the last decade. Here’s how they are doing it and why, and from whom they may be taking their lead.

One of our biggest questions as advisors and investors is, What am I getting for what I am paying?

The application of ETF layers within an investment mandate or portfolio can be a powerful tool to allow active managers to focus more time on what they do best – security selection.

Recent gains in global stock markets have brought optimism for economic recovery.

An effective strategy for investors amidst the recent market volatility is realizing losses on securities to offset capital gains in an investment portfolio

March 2020 has proven to be among the most challenging periods in the history of capital markets.

Perhaps more than ever, Canadians need a sense of confidence that they can achieve their investment and retirement objectives.