Let's talk about ETFs

[mtgordon]

I'm about to stick my money in the market and my biggest question is about ETFs. However, I haven't seen a good discussion on them so I'll attempt to start one.

Here is what I believe to be good about ETFs: lower ERs, more tax efficient (assuming you hold them for a long time), and you don’t need to meet a fund minimum. On the other hand Index Funds: do not have commission charges, a bid-ask spread, and not all Index Funds have ETFs. Another note is that if you rebalance your portfolio with ETFs you suffer the commission charges and bid-ask spread every time you move money around.

So the question is which one is the best for an individual investor? I can obviously give my scenario if someone would like to give me advice, but I figured that a discussion in general would be more beneficial to everyone.


Disclaimer: I am by no means a financial guru let alone an ETF specialist. These are just my findings from the past month or so of (very) light research.