Best ETFs for Traders and Speculators http://ww
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Posted On: 07/19/2014 12:46:08 AM
Best ETFs for Traders and Speculators
http://www.forbes.com/sites/baldwin/2014/07/1...eculators/
Do you want to go in and out of the market with a short-swing trade? If you plan on staying put for three months, Vanguard has the most efficient exchange-traded fund. Its S&P 500 portfolio (ticker: VOO) would cost you a bit more than $2 per $10,000 invested. It beats the much bigger SPDR S&P 500 fund (SPY) on that cost score.
For a three-month bet on the bond market, the cost winner is from BlackRock. Its iShares Core Total U.S. Bond Market ETF (AGG) would run you less than $3. Vanguard’s competing product, the Total Bond Market ETF (BND), is 10% more expensive.
For in-and-out trades in bullion, StateStreet’s SPDR Gold Shares (GLD), the leader in trading volume and assets, is superior to iShares Gold Trust (IAU).
Those are some of the findings from our survey of 244 cost-efficient ETFs. In this ranking, the winners are the funds that drain the least in overhead and transaction costs from the pocket of a speculator or hedger holding for three months.
Many investors have no use for rapid-fire trading. If you plan on holding for years rather than months, skip this survey and use the companion analysis scored for ten-year costs, Best ETFs for Investors.
Three numbers go into our cost calculation. One is the expense ratio. If a fund has 0.4% in annual expenses, it will cost you $10 per quarter for every $10,000 invested. Next is the expense offset that some funds get for their shareholders by lending out securities to short-sellers.
The third element is the bid-ask spread quoted on trading terminals. You’ll give up at least this amount to market makers on each round trip in and out of a stock or ETF. A fund that trades a few million shares a day, like SPY or GLD, will be available with a spread of a penny or two. On a sleepy fund the gap could be a dime or more.
What about brokerage commissions, which typically run from $5 to $10 for an online trade? We can’t put them into a cost score because they vary so much from broker to broker. We do, however, show which funds are offered commission-free at one or more of four big discounters.
Vanguard and Schwab have free round-trip commissions on their own ETFs. At Fidelity and TD Ameritrade the freebie works only when you’re buying; you may pay a commission, an early redemption penalty or a passed-along exchange fee when you sell.
There are other ways to avoid commissions. Many brokers offer free or deeply discounted online trading to customers who either are newcomers or have a lot of assets (say, $1 million).
To make the Best ETFs for Traders list, a fund had to jump four hurdles:
–assets of at least $50 million as of May 13.
–an expense ratio no higher than 0.4%.
–a three-month holding cost of $20 or less per $10,000 invested.
–a tradability score from ETF.com of at least 70.
ETF.com, formerly Index Universe, is a repository of information about exchange-traded funds. With “tradability” it measures how easily investors can get in and out of positions; this number blends metrics that matter mostly to individuals (like the bid/ask spread) and those that matter to institutions (like daily volume and how that compares to the baskets of securities used in creating and redeeming ETF shares). The details are explained here.
The rankings of ETFs for short-term costs are divided into separate tables, linked below.
Best ETFs for Traders: Large-cap Stocks
Best ETFs for Traders: Smaller Companies
Best ETFs for Traders: Sector Funds
Best ETFs for Traders: Diversified International
Best ETFs for Traders: Regional and Specialized International
Best ETFs for Traders: Currency and Commodity
Best ETFs for Traders: Short-term Bonds
Best ETFs for Traders: Medium-term Bonds
Our data sources: Morningstar for the expense ratios, ETF.com for the liquidity measure, Bloomberg for bid/ask spreads and fund vendors for securities lending revenue.
Best ETFs for Traders and Speculators
http://www.forbes.com/sites/baldwin/2014/07/1...eculators/
Do you want to go in and out of the market with a short-swing trade? If you plan on staying put for three months, Vanguard has the most efficient exchange-traded fund. Its S&P 500 portfolio (ticker: VOO) would cost you a bit more than $2 per $10,000 invested. It beats the much bigger SPDR S&P 500 fund (SPY) on that cost score.
For a three-month bet on the bond market, the cost winner is from BlackRock. Its iShares Core Total U.S. Bond Market ETF (AGG) would run you less than $3. Vanguard’s competing product, the Total Bond Market ETF (BND), is 10% more expensive.
For in-and-out trades in bullion, StateStreet’s SPDR Gold Shares (GLD), the leader in trading volume and assets, is superior to iShares Gold Trust (IAU).
Those are some of the findings from our survey of 244 cost-efficient ETFs. In this ranking, the winners are the funds that drain the least in overhead and transaction costs from the pocket of a speculator or hedger holding for three months.
Many investors have no use for rapid-fire trading. If you plan on holding for years rather than months, skip this survey and use the companion analysis scored for ten-year costs, Best ETFs for Investors.
Three numbers go into our cost calculation. One is the expense ratio. If a fund has 0.4% in annual expenses, it will cost you $10 per quarter for every $10,000 invested. Next is the expense offset that some funds get for their shareholders by lending out securities to short-sellers.
The third element is the bid-ask spread quoted on trading terminals. You’ll give up at least this amount to market makers on each round trip in and out of a stock or ETF. A fund that trades a few million shares a day, like SPY or GLD, will be available with a spread of a penny or two. On a sleepy fund the gap could be a dime or more.
What about brokerage commissions, which typically run from $5 to $10 for an online trade? We can’t put them into a cost score because they vary so much from broker to broker. We do, however, show which funds are offered commission-free at one or more of four big discounters.
Vanguard and Schwab have free round-trip commissions on their own ETFs. At Fidelity and TD Ameritrade the freebie works only when you’re buying; you may pay a commission, an early redemption penalty or a passed-along exchange fee when you sell.
There are other ways to avoid commissions. Many brokers offer free or deeply discounted online trading to customers who either are newcomers or have a lot of assets (say, $1 million).
To make the Best ETFs for Traders list, a fund had to jump four hurdles:
–assets of at least $50 million as of May 13.
–an expense ratio no higher than 0.4%.
–a three-month holding cost of $20 or less per $10,000 invested.
–a tradability score from ETF.com of at least 70.
ETF.com, formerly Index Universe, is a repository of information about exchange-traded funds. With “tradability” it measures how easily investors can get in and out of positions; this number blends metrics that matter mostly to individuals (like the bid/ask spread) and those that matter to institutions (like daily volume and how that compares to the baskets of securities used in creating and redeeming ETF shares). The details are explained here.
The rankings of ETFs for short-term costs are divided into separate tables, linked below.
Best ETFs for Traders: Large-cap Stocks
Best ETFs for Traders: Smaller Companies
Best ETFs for Traders: Sector Funds
Best ETFs for Traders: Diversified International
Best ETFs for Traders: Regional and Specialized International
Best ETFs for Traders: Currency and Commodity
Best ETFs for Traders: Short-term Bonds
Best ETFs for Traders: Medium-term Bonds
Our data sources: Morningstar for the expense ratios, ETF.com for the liquidity measure, Bloomberg for bid/ask spreads and fund vendors for securities lending revenue.
http://www.forbes.com/sites/baldwin/2014/07/1...eculators/
Do you want to go in and out of the market with a short-swing trade? If you plan on staying put for three months, Vanguard has the most efficient exchange-traded fund. Its S&P 500 portfolio (ticker: VOO) would cost you a bit more than $2 per $10,000 invested. It beats the much bigger SPDR S&P 500 fund (SPY) on that cost score.
For a three-month bet on the bond market, the cost winner is from BlackRock. Its iShares Core Total U.S. Bond Market ETF (AGG) would run you less than $3. Vanguard’s competing product, the Total Bond Market ETF (BND), is 10% more expensive.
For in-and-out trades in bullion, StateStreet’s SPDR Gold Shares (GLD), the leader in trading volume and assets, is superior to iShares Gold Trust (IAU).
Those are some of the findings from our survey of 244 cost-efficient ETFs. In this ranking, the winners are the funds that drain the least in overhead and transaction costs from the pocket of a speculator or hedger holding for three months.
Many investors have no use for rapid-fire trading. If you plan on holding for years rather than months, skip this survey and use the companion analysis scored for ten-year costs, Best ETFs for Investors.
Three numbers go into our cost calculation. One is the expense ratio. If a fund has 0.4% in annual expenses, it will cost you $10 per quarter for every $10,000 invested. Next is the expense offset that some funds get for their shareholders by lending out securities to short-sellers.
The third element is the bid-ask spread quoted on trading terminals. You’ll give up at least this amount to market makers on each round trip in and out of a stock or ETF. A fund that trades a few million shares a day, like SPY or GLD, will be available with a spread of a penny or two. On a sleepy fund the gap could be a dime or more.
What about brokerage commissions, which typically run from $5 to $10 for an online trade? We can’t put them into a cost score because they vary so much from broker to broker. We do, however, show which funds are offered commission-free at one or more of four big discounters.
Vanguard and Schwab have free round-trip commissions on their own ETFs. At Fidelity and TD Ameritrade the freebie works only when you’re buying; you may pay a commission, an early redemption penalty or a passed-along exchange fee when you sell.
There are other ways to avoid commissions. Many brokers offer free or deeply discounted online trading to customers who either are newcomers or have a lot of assets (say, $1 million).
To make the Best ETFs for Traders list, a fund had to jump four hurdles:
–assets of at least $50 million as of May 13.
–an expense ratio no higher than 0.4%.
–a three-month holding cost of $20 or less per $10,000 invested.
–a tradability score from ETF.com of at least 70.
ETF.com, formerly Index Universe, is a repository of information about exchange-traded funds. With “tradability” it measures how easily investors can get in and out of positions; this number blends metrics that matter mostly to individuals (like the bid/ask spread) and those that matter to institutions (like daily volume and how that compares to the baskets of securities used in creating and redeeming ETF shares). The details are explained here.
The rankings of ETFs for short-term costs are divided into separate tables, linked below.
Best ETFs for Traders: Large-cap Stocks
Best ETFs for Traders: Smaller Companies
Best ETFs for Traders: Sector Funds
Best ETFs for Traders: Diversified International
Best ETFs for Traders: Regional and Specialized International
Best ETFs for Traders: Currency and Commodity
Best ETFs for Traders: Short-term Bonds
Best ETFs for Traders: Medium-term Bonds
Our data sources: Morningstar for the expense ratios, ETF.com for the liquidity measure, Bloomberg for bid/ask spreads and fund vendors for securities lending revenue.
Best ETFs for Traders and Speculators
http://www.forbes.com/sites/baldwin/2014/07/1...eculators/
Do you want to go in and out of the market with a short-swing trade? If you plan on staying put for three months, Vanguard has the most efficient exchange-traded fund. Its S&P 500 portfolio (ticker: VOO) would cost you a bit more than $2 per $10,000 invested. It beats the much bigger SPDR S&P 500 fund (SPY) on that cost score.
For a three-month bet on the bond market, the cost winner is from BlackRock. Its iShares Core Total U.S. Bond Market ETF (AGG) would run you less than $3. Vanguard’s competing product, the Total Bond Market ETF (BND), is 10% more expensive.
For in-and-out trades in bullion, StateStreet’s SPDR Gold Shares (GLD), the leader in trading volume and assets, is superior to iShares Gold Trust (IAU).
Those are some of the findings from our survey of 244 cost-efficient ETFs. In this ranking, the winners are the funds that drain the least in overhead and transaction costs from the pocket of a speculator or hedger holding for three months.
Many investors have no use for rapid-fire trading. If you plan on holding for years rather than months, skip this survey and use the companion analysis scored for ten-year costs, Best ETFs for Investors.
Three numbers go into our cost calculation. One is the expense ratio. If a fund has 0.4% in annual expenses, it will cost you $10 per quarter for every $10,000 invested. Next is the expense offset that some funds get for their shareholders by lending out securities to short-sellers.
The third element is the bid-ask spread quoted on trading terminals. You’ll give up at least this amount to market makers on each round trip in and out of a stock or ETF. A fund that trades a few million shares a day, like SPY or GLD, will be available with a spread of a penny or two. On a sleepy fund the gap could be a dime or more.
What about brokerage commissions, which typically run from $5 to $10 for an online trade? We can’t put them into a cost score because they vary so much from broker to broker. We do, however, show which funds are offered commission-free at one or more of four big discounters.
Vanguard and Schwab have free round-trip commissions on their own ETFs. At Fidelity and TD Ameritrade the freebie works only when you’re buying; you may pay a commission, an early redemption penalty or a passed-along exchange fee when you sell.
There are other ways to avoid commissions. Many brokers offer free or deeply discounted online trading to customers who either are newcomers or have a lot of assets (say, $1 million).
To make the Best ETFs for Traders list, a fund had to jump four hurdles:
–assets of at least $50 million as of May 13.
–an expense ratio no higher than 0.4%.
–a three-month holding cost of $20 or less per $10,000 invested.
–a tradability score from ETF.com of at least 70.
ETF.com, formerly Index Universe, is a repository of information about exchange-traded funds. With “tradability” it measures how easily investors can get in and out of positions; this number blends metrics that matter mostly to individuals (like the bid/ask spread) and those that matter to institutions (like daily volume and how that compares to the baskets of securities used in creating and redeeming ETF shares). The details are explained here.
The rankings of ETFs for short-term costs are divided into separate tables, linked below.
Best ETFs for Traders: Large-cap Stocks
Best ETFs for Traders: Smaller Companies
Best ETFs for Traders: Sector Funds
Best ETFs for Traders: Diversified International
Best ETFs for Traders: Regional and Specialized International
Best ETFs for Traders: Currency and Commodity
Best ETFs for Traders: Short-term Bonds
Best ETFs for Traders: Medium-term Bonds
Our data sources: Morningstar for the expense ratios, ETF.com for the liquidity measure, Bloomberg for bid/ask spreads and fund vendors for securities lending revenue.
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