The Advantages of ETF's

When there is a large demand for these the price will increase for a short period of time over the ETF’s cost per share, this gives rise to investors to buy more units and sell off parts that are not. The ultimately means that the premium value is greatly reduced.

ETF’s are also vary tax-efficient due to the fact that the capital gains are mostly paid at the end sale. This is a good option because what would be paid thought out is instead allowed to accrue interest and therefore is a benefit. What the gain is obviously depends on the portfolio but if exploited can result in a gain.

Another advantage is that you can arrange your ETF easily. We have already talked about buying ETF’s in baskets so it stands that when you buy, you buy from one place and don’t have to pull parts from different places. You view it in one place, manage it in one place and because you are working with a bank or brokerage you have online options already available.

ETF’s can’t be manipulated. They are openly traded, where anyone with a portfolio can jump in. this may seem bad but really the more buyers the higher the cost is driven up and thus translates into more profit. They also show the price of the market at that moment which can translates into real-time investing strategy.

ETF’s trade like stocks, this is a advantage because unlike a mutual fund there are investing strategies that can be utilized like short selling. ETF’s allow a investor to buy a ETF at a certain price and then sell it in the same day.

The reasons for the popularity of ETFs are easy to understand. The associated
costs are low, and the portfolios are flexible and tax efficient. The push for
expanding the universe of exchange-traded funds comes, for the most part, from
professional investors and active traders. - James E.
McWhinney