Investing February 9, 2001

ETFs Expand Rapidly in 2000

February 9, 2001 (PLANSPONSOR.com) - Exchange-traded funds, or ETFs, totaled $65.6 billion at the end of 2000, according to the Investment Company Institute (ICI) which has begun tracking monthly ETF statistics.
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Investors have welcomed the “new” investment class, which generally offers more trading flexibility and lower expense ratios than comparable mutual funds.  The first ETFs began trading on the American Stock Exchange in 1993,     

An exchange-traded fund is an investment company with shares that trade intraday on stock exchanges at market-determined prices, as do stocks.

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However, at year-end 2000, total ETF assets were a mere fraction of the $6.9 trillion invested in mutual funds.

Type Cast

At 12/31 there were 80 ETFs trading on U.S. stock exchanges, up from 30 at the beginning of the year.

Fifty-five ETFs totaling $63.5 billion tracked domestic stock indexes.  Twenty-eight used broad indexes, while 27 targeted industry or sector indexes.

Twenty-five ETFs were classified as Global/International

The Investment Company Institute offers frequently asked questions about ETFs at http://www.ici.org/aboutfunds/etf_faqs.htm .

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