ETFs: An investment for the long term

While they certainly can be used for short-term exposure, Exchange-Traded Funds (ETFs) can be an effective way to seek long-term growth as a core part of your portfolio. In fact, many of today’s ETFs are intended to be longer-term strategies. These ETFs are diversified and provide broad market exposure. 

The advantages of ETFs

Long-term investors are ultimately looking to achieve steady, long-term growth. In favourable market conditions, what assists with that long-term growth is the power of time and compounding, and the amount of money invested. In this regard, ETFs offer a solid benefit, thanks to their potentially lower fees and tax efficiency.

More money to grow

One of the major benefits of ETFs is that they typically have low fees, which stems from a variety of factors, including lower management fees and low operating costs. Those lower fees can translate into more money in an investor’s pocket, or portfolio.

Image shows drawing of hand holding a coin with a dollar sign. Low management fees.

Image shows drawing of two hands holding a suitcase with a dollar sign. Low operating costs.

Image shows drawing of a calculator. Low portfolio turnover.

Image shows drawing a flower with three leaves. More money to grow.

Similarly, thanks to their more passive approach to investing, ETFs typically have low portfolio turnover – the result of the buying and selling of securities – which can rack up costs. That also means less frequent triggering of capital gains.

Commissions, management fees and expenses all may be associated with exchange traded funds (ETFs). Investment objectives, risks, fees, expenses and other important information are contained in the prospectus, please read it before investing. ETFs are not guaranteed, their values change frequently and past performance may not be repeated.

Manulife ETFs are managed by Manulife Investments, a division of Manulife Asset Management Limited.

Read more about ETF and Investing