[jimjamuser]

Originally Posted by rsmurano

It’s funny when people talk about generic etf’s like they are something magical, and they aren’t. It’s better to talk about managed funds vs index funds.
You can buy thousands of different etf’s or thousands of indexed funds or from thousands of managed funds.
No matter what you buy, you have to do your own research on which fund matches your investment goals and criteria. ETF’s can go down in value just like any other fund, so don’t think you can throw a dart at a wall of ETF’s and expect to make money.
I never use managed funds for a number of reasons: expense costs are huge, the turnover % are higher because the analysts are always trying to either balance the fund or chase it (you pay each year for this turnover), and I trust the broad index instead of what the analyst thinks. Index funds always outperform managed funds over the long haul.
The benefit of ETF’s are that you can trade them like a stock instead of waiting for the close of the market before they will buy or sell them. If you want to sell/buy stocks the same day, I can do this in the same trade with no problem, no need to wait multiple days for the trade to clear.
As for the person who lost a lot of money during the .com era, why? The only reason you lost money is because you sold low and probably bought high. If you didn’t need the money, let it ride and keep buying more if the stock/fund is good quality, any loss by a downturn is on paper. This is where dollar cost averaging comes into play: when you constantly put money into the market no matter if it’s on a high or on a low.
Since I dollar cost averaged most of my purchases during my career, I wanted the market to be really low so I can purchase more shares whereas if the market is high, it’s ok to brag about your portfolio but each monthly purchase of new shares will buy less.

The best explanation as to why ETFs are superior to mutual funds.