ETF Issuers
On the subject of Exchange Traded Funds, or ETFs, it is good to know who creates and manages them. Every fund serves a different purpose, and with most funds taking a small management fee, it is a business in the end. So who is in the business?
The following are six prime issuers of ETFs. You probably have seen these names before, and if not you will see them eventually.
The way the issuers make money is off of the management fees automatically taken out for being in the fund. If a ETF has a management fee of 0.5% per year of total assets, and you had for example $10,000 invested in that ETF, then your fee for the year would be $50 ($10k x 0.5%). Almost all ETFs have a management fee of less than 1%.
Mutual funds run the same way, but mutual fund fees can be significantly higher, especially when you bring loads into the picture.
I personally like Vanguard’s ETFs. They have 33 different ETFs and make it simple to compare. Thanks for the update on the ETF issuers.