Five Ways You May Be Using the Wrong ETF

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June 14, 2012 12:17pm NYSE:DVY NYSE:GLD

Matt Hougan, Index Universe president of ETF analytics, breaks down five ways to tell if you’re using the wrong exchange traded fund. Matt explains how to identify the ETF that gives you the best exposure to the sector you wish to invest in. He notes that


some of the well known ETFs may not be the best ETF for that sector.

Matt names of 5 common places he thinks people are using the wrong ETFs:

  • For the Gold sector: Instead of using (NYSEARCA:GLD), use (NYSEARCA:IAU)
  • For the Financial sector: Instead of using (NYSEARCA:XLF), use (NYSEARCA:IYF)
  • For Junk Bonds: Instead of using (NYSEARCA:JNK), use (NYSEARCA:HYG)
  • For the Dividend Equity: Instead of using (NYSEARCA:DVY), use (NYSEARCA:HDV)
  • Finally, for Small Caps: Instead of using (NYSEARCA:IYM), he suggests using (NYSEARCA:VB)

Watch the full CNBC interview below:


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