What's The Secret To Best Use Sector ETFs?

TL;DR

Learn how to enhance your portfolio returns using ETFs, whether through broad asset allocation or sector-specific strategies.

Transcript

ETS used to be a way just to mimic the market now they're turning into a way to try to beat the market we're talking with Todd burrows and Bluth the analysts at CFRA and super ETF guru about ways to use ETF to turbocharged the returns in your portfolio hi Todd thanks for joining us today my pleasure thanks a lot Matt so how do you recommend that pe... Read More

Key Insights

• ↩️ ETFs can be used strategically or tactically to enhance portfolio returns.
• 🧑‍🏭 Sector ETFs offer exposure to specific industries, either through market-cap weighting or multi-factor approaches.
• 💐 Diversification and thematic investing are attractive features of ETFs.
• 🉐 Actively managed ETFs with less transparency are expected to gain traction in 2020.

Questions & Answers

Q: How can ETFs be used to enhance portfolio returns?

ETFs can be utilized in different ways, such as strategic asset allocation to obtain broad exposure or tactical approaches focusing on momentum or value-oriented ETFs.

Q: What are some recommendations for using sector ETS in a portfolio?

Investors can either choose market-cap weighted sector ETFs or take a more fundamental approach by selecting ETFs that focus on value or quality characteristics. Additionally, investors can narrow their focus to subsets within a sector.

Q: When would it be beneficial to use ETF strategies alongside individual stocks?

ETFs provide the benefits of diversification within one trade, allowing investors to mitigate risks associated with individual stocks. They can also serve as a way to invest in longer-term thematic trends rather than picking individual winners.

Q: What are the potential hot trends in ETFs for 2020?

Actively managed ETFs with less transparency are expected to gain attention in 2020, with major asset managers like Fidelity and T. Rowe Price launching their own offerings. Additionally, fixed income ETFs are likely to remain in demand, providing exposure to the bond market and less interest rate-sensitive products.

Summary & Key Takeaways

• Use ETFs strategically by holding them for the long term and periodically rebalancing to lower-risk or lower-volatility dividend-oriented options.

• Sector ETFs can provide clean exposure to specific sectors, either through market-cap weighted strategies or multi-factor approaches.

• ETFs offer diversification benefits and thematic opportunities for long-term investment themes.