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Dave Nadig
3:25
A few things: for most passively managed ETFs, there is a no-load mutual fund equivalent out there somewhere.  Chances are its more expensive, and you may pay a fee to get in and out of it (depending on where you trade).
3:26
So apples to apples, cost will usually be in the ETF camp, and ETFs are generally just more tax efficient because of their structure.
So there are reasons to own both:
Mom & Pop
3:26
In total invested $ which holds more $ - ETF’s or MF’s
Dave Nadig
3:26
The number right now is something like 3T in ETFs and 12T in Mutual Funds (off the top of my head).
3:27
My prediction is that we see parity in about 5 years.
Mutual Funds are still a great choice for things like 401K plans because they dont worry about taxes, and you can do fractional shares really easily.
so MFs dong GO AWAY.  ETFs just take in all the new non-retirement money.
Rian
3:27
what ETF launched in the last 6 months will have highest AUM by year end?
Dave Nadig
3:28
I feel like this is a cheap answer, but probably VXXB (which replaced VXX).  People still wanna trade vol.
(obligatory disclosure: VXXB is based on the Vix, which ETF.com's parent company, Cboe Global Markets, created).
Not an endorsement of course: I just think it gets back into the billions.
Lane Sumner
3:29
Hi Dave. What would you say are the most common ETF misconceptions?
Dave Nadig
3:29
That all ETFs are indexed, low cost, and tax efficient.
MOST are, but there are enough exceptions to make due dilligence incredibly important.
You can buy an ETF that costs over 1%, has exposure you don't expect, pays capital gains out, and is probably actively managed.
3:30
with so many new products coming to market, the wrapper isn't getting in the way of old tricks.
Jake
3:30
SPY is dying? How can that be the case for the world's largest ETF?
Dave Nadig
3:30
Well, its not the cheapest anymore, and because it is structured as a UIT (not as a mutual fund, like most ETFs) it can't reinvest dividends.
3:31
So it will, by design, underperform a similarly priced newer-model ETF like IVV or VOO.
There's quite literally nothing SSGA can do about that.
So we've seen money just slowly run into the cheaper, better-structured products.
It's not SPY's "fault" -- it was the first out, so it went with a structure the SEC would approve, and that everyone could make function.
It's just old-school.
3:32
Here's a big one to close on:
George Ralls
3:32
Good day; I'm 70 yrs. old and need help building a portfolio based on 2019 economic expectations, volatility. I'm open to suggestions, with exception of bond ETF's due to lack of knowledge of different bond types and risks. Currently own individual equities related to 5G rollout- Cisco, Qualcomm, Erickson, Intel etc. Thank you.
Dave Nadig
3:32
George: So glad you could join us.  My actual suggestion is that you consider working with an advisor, even if it's an "
automated" advisor.
3:33
Chances are, your current broker has a very inexpensive or free offering that can get you into a diversified portfolio of ETFs appropriate for your time horizon.
Schwab, Vanguard both have offerings, and certainly many of the broader platforms (BAML, Fidelity and so on) have referal services at a minimum.
3:34
Since you're in individual equities, I'm projecting here, but I'm guessing you enjoy that part of investing. And that's great.
But most advisors would suggest you bucket off some "fun money" to trade stocks with, that's a fraction of your overall portfolio.
3:35
And with that, we're going to wrap it up.  Sorry if I didn't get to your question this week.  Will hit them again next time!
Thanks everyone for joining, and have a great afternoon.
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