Over the past decade, exchange-traded funds (ETFs) have transformed the investment industry with total net assets skyrocketing to $6.73 trillion by February 2023. As a passive investment product, ETFs track a particular index and aim to replicate its performance. To maintain low tracking error, ETFs rebalance portfolios following underlying index reconstitutions. With the rise in… Read More »
Corporate bond exchange-traded funds (ETFs) have been increasing rapidly and becoming an emerging financial instrument in the past two decades. They allow investors to build low-cost bond portfolios. Investors can adjust positions in real-time instead of trading corporate bonds over the counter or investing in bond mutual funds with minimums and limits. With ETFs targeting… Read More »
Despite likely being the most successful investment product since the 2008 global financial crisis, exchange traded funds (ETFs) have a serious comparability problem. The problem is particularly acute in environmental, social, and governance (ESG) themed funds, which have benefited from a recent surge in investor interest. A post-crisis explosion in ETF product offerings, combined with extensive issuer discretion in the composition, replication and tracking… Read More »
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