Customer Reviews

Exchange-Traded Funds For Dummies

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Reading this 338-page book will make you a very intelligent ETF investor. Whether or not you will be successful depends on you. Russell Wild, the author, provides a solid, entertaining, and comprehensive analysis of ETFs - the latest Wall Street craze. ETFs have grown to over $400 billion in assets with over 438 ETFs in existence.

Wild begins with the history of ETFs. Then he compares ETFs to stocks and mutual funds including the tax implications of selling ETFs, and the differences in annual expense ratios. A comparison to closed-end funds would have also been helpful, since many investors are not familiar with that useful investment category.

One chapter introduces the need to open a brokerage account to buy and sell ETFs, and then focuses on the major firms offering them. Next, the author delves into the riskiness of ETFs, how risk is measured, and discusses beta and correlation. Many investors will learn a great deal about risk in this chapter, which they often neglect in making investment decisions.

The author has multiple chapters on the basic ETFs, including large and small caps focusing separately on value and growth, and then reviews sector ETFs, REIT ETFs, and commodity ETFs.

In one of the closing chapters, Wild provides sample ETFs portfolios for different risk levels, suggest that buy-and-hold is the way to go, and then provides a few exceptions to that approach. He also includes a chapter on using ETFs in retirement plans, as well as has chapters on the 10 most common questions about ETFs, and the 10 biggest mistakes investors make.

Wild includes a 12-page appendix from www.etfguide.com that contains a listing of 300 ETFs by broad categories, their name, ticker symbol, expense ratio and exchange. Since there are now 438 ETFs, this appendix is out-of-date and useless, wasting twelve pages. The reader can go directly to the website to get the latest listings.

Another appendix contains a cross section of ETF and other useful websites. Another excellent website to add to his list is www.etfscreen.com, which provides current short-term performance data after each day's market close on all the ETFs. The 6-page glossary of terms and the 14-page index all provide helpful information

In conclusion, this is simply the best introductory book on ETFs. The author provides many useful tables, charts and diagrams to bring home his key points. For those investors looking to actively trade or invest in ETFs, or are searching for profitable back-tested strategies the next book they should buy after this one is Marvin Appel's Investing With Exchange-Traded Funds Made Easy (see my review of this book on AMAZON). If investors/traders want to use a simple relative strength approach, then they should consider David Vomund's ETF Trading Strategies Revealed paperback recently released.

Even though this book is focused on ETFs, it is far more than just that. It actually covers investment strategy in an easy-to-understand manner. It compares ETFs to other investment vehicles, and demonstrates how to balance a portfolio to meet specific investment goals. What I found particularly valuable was Chapter 16 - Sample EFT Portfolio Menus. It is broken down by investment goals (i.e. - "Racing toward riches: a portfolio that may require a crash helmet.") and has specific ETFs and the proportions to meet the stated goal.

This is the best book I have ever seen for intermediate level investors. It informs without lecturing and provides specific, actionable recommendations.

Mr. Wild is an entertaining writer, who breaks down what is appropriate for small, medium and wealth investors. My only wish is his chapter on sample portfolios were more detailed. I would have liked to see sample portfolios optimized for cost, risk tolerance, equity only and for those nearing and in retirement. Vanguard should consider giving away this book out to anyone opening an account with them, given how much he repeatedly triumphs Vanguard's nearly universal low fees!

I am an investment advisor preparing to teach an adult education class on Index Investing. This book is by far the most current, concise and informative text available today. It is not only complete but easy to read. Mr. Wild's sense of humor makes every chapter a delight to read. Mr. Wild knows his subject. Read the book and you will too.

I've been in the ETF 'game' for awhile now and have read quite a number of books on investings, ETFs, finance, and the whole lot. As always, the Dummy series does an excellent job in explaining what might be complicated for some folks in an understandable and fun way. The author does a superb job with cutting through the bull of the bear n' bull pundits and giving you very real and very good advice. This should be your first book to read if you are considering ETFs - then you can take on more detailed and convoluted volumes. Good job!

PROS
- enjoyable writing style, easy read.
- author's knowledge.
- author provides specific reviews of many ETFs.
- much additional information on financial management, beyond ETFs.

CONS
- the author carefully builds a solid case for buying ETFs, but does not adequately address why someone would buy an EFT over a low cost index fund held in a retirement account.

- for some readers (like me), there needs to be more technical discussion of how ETFs are structured and how they operate, as opposed to describing ETFs merely by their benefits and roles in a portfolio.

- the author's case for ETFs does not address one serious drawback of ETFs: difficulty of conducting automatic dollar cost averaging (DCA); of course, this is possible to do transaction-fee-free (or nearly so) at some brokerages, but ETFs require trading commissions and you have to conduct DCA yourself, as brokerage typically will not buy stocks (or ETFs) on an automatic schedule.

I started knowing nothing, and finished being very sure of how to select - and why to purchase specific ETFs. I've not found a better introductory book on the subject (and I hope Vanguard are paying the author a good sum for plenty of free advertising!)

I loved Wild's first book on ETFs. The second edition is welcome given the volatile markets in the last few years. Wild makes it very easy to understand ETFs and his writing style and personal stories are a lot of fun along the way.

If you are pondering whether to press the "select" button on this book, "just do it." Russell Wild has written a very approachable, compelling, fun and smart book for those of us who want to know more about ETF's, create our own portfolios and not be "dumb" about ETF's and our money.

"Exchange Traded Funds for Dummies" is the best book I've ever read on the subject. Russell Wild writes about this complicated topic simply, clearly and with a "bucket" load of humor (my lame attempt here at financial wit!).

His book makes learning the ins and outs of ETF's enjoyable and fun. Mr. Wild has a wonderful talent in being able to engage the reader in such a way as to make finances seem, well, interesting! I'm so much more knowledgeable on the subject now and have gained a sense of confidence and understanding that I didn't have before.

Norma Larson
Covina, California
(AKA A Dummy No More)