Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.
In Practice October 4, 2007
Clients Look to Advisers for Help with ETFs
Among investors who work with financial professionals, 40% would like more information about ETFs and about half (51%) would consider investing in exchange-traded funds (ETFs) if their adviser suggested it, according to a survey by an ETF provider.
Reported by Alison Cooke
According to the results of a survey of 500 mutual fund investors conducted by Rydex Investments, younger investors are even more receptive to ETFs; almost 80% of investors younger than age 30 would invest in ETFs if suggested by their adviser.
However, even though Americans have a willingness to invest in the product, the Rydex survey found that there is a significant lack of knowledge about the products. The main reason 63% of investors don’t invest in ETFs is because they don’t know enough about them, despite the proliferation of the investments and the significant coverage of the investments in the mainstream media. In fact, more than a third (38%) of individual investors do not know what an ETF is, and more than half (53%) do not know the difference between an ETF and a mutual fund.
Further, investors indicate an interest in ETF education. More than a third (35%) of individual investors would like to learn more about ETFs.
The survey of 500 individual mutual fund investors was conducted by Rydex Investments in July 2007. All participants had investable assets of more than $100,000, with 150 of the participants having investable assets of more than $500,000.