Exchange-Traded Funds for Dummies

SPDR Portfolio Developed World ex-US ETF (SPDW) Indexed to: S&P Developed Ex-U.S. BMI Index. BMI stands for Broad Market Index. Broad? Enough. This fund has 2,320 holdings. Expense ratio: 0.04 percent Top five country holdings: Japan, United Kingdom, France, Canada, Germany Russell’s review: With the lowest expense ratio in the category, heck y

The four original ProShares inverse ETFs are the Short QQQ fund (PSQ), which is betting against the NASDAQ-100; the Short S&P500 (SH); the Short MidCap400 (MYY); and the Short Dow30 (DOG). DOG,

What’s the advantage of maturity-date bond ETFs over other bond ETFs? With most bond ETFs, if there’s a swift hike in interest rates, your fund price could drop overnight. It will then likely rise back up over time, but not if you have to withdraw the money to buy, say, a new car, or pay for your kid’s tuition. In that case, you’re out of luck (and

Vanguard Mega Cap 300 Growth ETF (MGK) Indexed to: CRSP U.S. Mega Cap Growth Index (110 or so of the largest growth companies in the United States) Expense ratio: 0.07 percent Average market cap: $435.7 billion P/E ratio: 40.5 Top five holdings: Apple, Microsoft, Amazon, Alphabet, Facebook Russell’s review: Bigger is better…sometimes. If you have s

But there’s little question that people who divide their portfolios into large/small/value/growth are much more likely to be long-term investors with long-term strategies than are people who buy into sectors (often through ETFs). That’s just the way it is.

The S&P is considered your baseline, and it is assigned a beta of 1. So if you know that Humongous Software Corporation has a beta of 2, and the S&P shoots up 10 percent, Jimmy the Greek (if he were still with us) would bet that shares of Humongous are going to rise 20 percent. If you know that the Sedate Utility Company has a beta of 0.5,

Reaching for the elusive Efficient Frontier means holding both stocks and bonds — domestic and international — in your portfolio. That part is fairly straightforward and not likely to stir much controversy (although, for sure, experts differ on what they consider optimal percentages).

Vanguard Total International Bond (BNDX) Indexed to: The Bloomberg Barclays Global Aggregate ex-USD Float Adjusted RIC Capped Index (USD hedged), government and corporate bonds — about 6,300 of them — from all corners of the globe, although 95 percent of the bonds are from developed nations Expense ratio: 0.08 percent Current yield: 0.44 percent Av

The recipe that makes most sense to me is to split up your wisely chosen international ETFs into two large categories: developed markets and emerging markets. For most portfolios, a reasonable split of foreign stock holdings would be something in the neighborhood of 75/25, with 75 percent going to developed nations (England, France, Germany, Japan,