Canada’s ETF industry is still very small compared to the mutual fund arena: ETF assets at the end of October 2022 totaled $300 billion, a fraction of $1.796. Trillion in mutual fund assets. But the number of ETFs available has grown steadily over the past two decades, in Canada and around the world — and now investors have thousands to choose from.
Like mutual funds, ETFs are a “basket” of securities assembled by investment professionals. A single ETF can hold shares in hundreds or thousands of companies. ETFs can be very broad – tracking, or simulating, the entire stock market – or very specific, focusing on a specific sector, asset type, commodity, geographic region or theme. ETFs can hold other types of assets, including bonds, commodities, currencies and cryptocurrencies.
ETF investment strategies, asset mixes, risk levels and management fees can vary widely. How do investors choose from this veritable property buffet? As with any investment, it pays to do your research. Start with the fund’s ETF fact sheet – but don’t stop there.
Here’s your starter kit for ETF research.
- How to evaluate ETFs based on financial reports
ETF providers are required to issue a wide variety of financial reports and documents that investors can use to their advantage. We provide an overview of what’s available, how often reports are updated, where to find them, and what you can learn if you dig beyond the ETF fact sheet and prospectus.
- What type of ETF investor are you?
No two investors are the same. In this article, we look at different interests, risks, and perspectives—from first-timers and novices to more experienced balanced, conservative, and aggressive investors—and the strategies, asset mixes, and types of ETFs that best suit their goals and risk tolerance.
- What do experienced investors look for in an ETF prospectus?
What is an ETF fact sheet, and what is in an ETF long-term prospectus? Let’s take a closer look at these two documents, each containing details to help you make an informed decision. We’ll explain where to find ETF fact sheets and prospectuses, what they contain and what features to zero in on—as well as other important financial reports. We read the fine print, not so you don’t want it, but so you know what to look for.
Explore ETFs further
ETFs for different life stages
Now you can take a closer look at how ETFs fit your investment strategy. We have ideas for everyone, from children saving for school (through their parents or guardians) to retirees looking to build a solid portfolio.
ETF investment strategies
How to switch from mutual funds to ETFs – and you? Can a single ETF serve as your entire portfolio? We have addressed these and other questions.