Exchange Traded Funds (ETFs)

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Exchange Traded Funds (ETFs)

ETFs Explained

An ETF is a security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange

Exchange Traded Funds

An ETF is a security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold, just as stocks do.

What Are Exchange Traded Funds

ETFs Explained

An ETF is a security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange. ETFs experience price changes throughout the day as they are bought and sold, just as stocks do. ETFs combine the advantages of stocks and those of index funds. Like stocks, they are liquid and easy to track. Like index funds, they can provide

Diversification

Market tracking

Low expense ratios

In short, ETFs are powerful investment tools you can use to get the exposure you need, at the level you want, at the moment you need it.

Over the years, investors have learned that appropriate asset allocation is vastly more important than a hot stock tip; that portfolio diversification makes far more sense than putting all your eggs in one basket; and that taxes can erode some traditional mutual fund returns. ETFs can provide a solution for asset allocation, diversification and tax efficiency;

helping to build a cost-effective, balanced core portfolio.

Benefits of an ETF

Exchange Traded Funds (ETFs) offer many attractive features and benefits for investors, including:

Lower Cost ETFs tend to charge lower management fees and expenses (i.e., commission fees and trading costs) than many other diversified investment options. That means more of your money is working for you over the long term.

Portfolio Transparency The current trading price of an ETF can be viewed at any time during a regular trading day and the portfolio composition can be verified on a daily basis. This can be particularly helpful during volatile investment markets.

Investment Flexibility Most ETFs can be bought and sold at current market prices throughout the trading day. Investors can access securities broadly linked to a particular region, market, sector, commodity or theme. Plus, investors can implement their positive or negative views on a particular market or sector by investing either long or short.

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Exchange Traded Funds (ETFs) | Scotia iTRADE

 Liquidity Unlike other similar investments, ETFs enable investors to buy and sell whenever the markets are open. In addition, the true liquidity of an ETF is generally represented by the liquidity of the underlying securities.

Diversification By aiming to replicate a specific index or market return, an ETF often incorporates all, or a representative sample of, the securities that make up that index. This can help lower portfolio variability and reduce price volatility, especially when compared to individual securities.

Taxation ETFs tend to have low portfolio turnover and fewer realizations of capital gains and losses than other investment products

Research an ETF

Scotia OnLine offers you great tools in the Quotes & Research section of the platform. Select ETFs from the submenu. From here you have access to the following tools:

Compare Tool ETFs Screener ETF Education

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Exchange Traded Funds (ETFs) | Scotia iTRADE

Invest in ETFs

ETFs are bought and sold like stocks. Log on to Scotia iTRADE and click the `Trade' tab on the first level top navigation. The default page you will arrive at is the Order Entry page, with the Equities trade ticket open for you.

Select Account Select Symbol or use magnifying glass

to search Select Market

Select Order Type, i.e. do you want to buy or sell

Enter Quantity

Select Price Type, i.e. Market, Limit, Stop or Stop Limit Order

Select Expiry Term, i.e. Day or GoodUntil-Canceled Order (GTC) up to 30 calendar days

For All-or-None Orders, check the box. Learn more

Click `Preview Order'. Check your order carefully before inserting your Access Code and submitting your order

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Exchange Traded Funds (ETFs) | Scotia iTRADE

To learn more about ETFs and ETF Tools, join our ETF Webinars or view our Webinars on Demand. To learn more about how you can trade some ETFs for free please click here.

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Exchange Traded Funds (ETFs) | Scotia iTRADE

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