Issuers of exchange-traded funds plan to roll out a wave of single-stock ETFs. These funds, a handful of which are already available, will bet against individual stocks or amplify their daily moves or both. Needless to say, single-stock ETFs have not been greeted with enthusiasm. Regulators are sounding alarms about their risks. Financial advisers are warning investors to stay away. CNN called them apocalyptic.
My colleague and ETF guru Eric Balchunas thinks the reaction is “overly-hyperbolic pearl clutching,” and he’s not wrong, mostly because ETFs jumped the shark long ago….
Source: Personal Finance: No Investor Should Be Buying Single-Stock ETFs – Bloomberg
