A 12-point checklist for finding quality ETFs

Article Excerpt

The best ETFs offer low fees and diverse exposure to several companies operating in an economy or a specific industry or region. They don’t, however, eliminate market volatility, although their diversity usually cuts your risk of permanent loss. ETFs can also cut down research time required to analyze individual stocks when building a portfolio. Meanwhile, here’s a 12-point checklist to help you find the gems among the rising number of ETFs out there for investors: 1) A stable and reputable parent company Although ETFs are well regulated in both Canada and the U.S., investors still need to check which entities are responsible for the promotion and management of the ETF and its assets. The big-name ETF providers such as iShares (Blackrock), RBC, Vanguard, BMO, and SPDR (State Street) do not normally require further investigation, but investors may want to check on the credentials of lesser-known issuers. That includes checking on arrangements for the custody of the assets, the auditors, the ETF and mutual fund…