Exchange-Traded Funds For Dummies, 3rd Edition

Chapter 1

No Longer the New Kid on the Block

IN THIS CHAPTER

Discovering the origins of ETFs

Understanding their role in the world of investing today

Getting a handle on how ETFs are administered

Finding out how ETFs are bought and sold

Tallying the phenomenal growth of ETFs

There are, no doubt, a good number of pinstriped ladies and gentlemen on and around Wall Street who froth heavily at the mouth when they hear the words exchange-traded fund. In a world of very pricey investment products and very well-paid investment-product salespeople, ETFs have been the ultimate killjoys.

Since their arrival on the investment scene in the early 1990s, some 3,300 ETFs have been created, and ETF assets have grown faster than those of any other investment product, by far. That’s a good thing. ETFs enable the average investor to avoid shelling out fat commissions or paying layers of ongoing, unnecessary fees. And they’ve saved investors oodles in taxes.

Hallelujah.

In the Beginning

When I was ...