Educating clients about ETFs: Let FundVisualizer highlight the advantages

Putnam Investments, 09/04/20


Even clients who have a good grasp of investing basics may not yet be aware of exchange-traded funds — although ETFs may already be part of their portfolios. U.S. investors have poured some $4 trillion into ETFs as of 2020 (up from $500 billion a decade ago), but the investments still remain under the radar for many. It is very likely that a percentange of your clients have fundamental unanswered questions about these increasingly popular funds:

  • What are ETFs?
  • What are the advantages of ETFs versus other investments?
  • What place, if any, do they have in my portfolio?

If ETFs are part of your offering, it may be a good time to educate clients about the opportunities for diversification, cost advantages, and potential tax efficiency that make ETFs attractive. FundVisualizer can support your education effort; ETFs are included among the 30,000 investments in the FundVisualizer universe of funds.

The best approach when talking about ETFs is to keep it simple. Think about what your clients already know and understand, and how you can build on that knowledge.

Clients with more sophisticated investment understanding may have detailed questions about tax advantages or risks associated with ETFs. But many investors will be starting with a blank slate.

For both audiences, showing is always more effective than telling.

Use FundVisualizer comparison tools for an overview or deep dive into ETFs

FundVisualizer gives you an extensive range of options examining and comparing ETFs.

To begin, click "Compare" and search by fund name or ticker to call up the ETFs you want to review. Choose one fund or create a list of several, then click "Create." You can also import a client’s portfolio to discuss the investments in context.

FundVisualizer gives you a choice of nine chart types, many of which can help you dive into the details of ETFs.

For an overview discussion on diversification offered by ETFs, choose Asset allocation, Sector, or Top holdings charts. For more detailed discussions about cost or performance, create a custom comparison using the Table, Bar, or X/Y charts. These charts offer a number of options for measuring performance before and after sales charges.

You can explore more features of FundVisualizer by visiting our resource library. To begin using FundVisualizer, click here.

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