- Joined
- 5/15/15
- Messages
- 22
- Points
- 13
Hey everyone,
Not sure if this is the right category for this question but it seemed closest:
If one were to invest (vs. speculate) in a stock, one might do a fundamental analysis of that stock (look at balance sheets, calculate ratios, etc.), but if you want to invest (vs. speculate) in an ETF, what's the "fundamental analysis" of an ETF? It doesn't seem reasonable to just do a fundamental analysis of each constituent in the ETF and add them all up (or I wouldn't spend my time doing that), so what kind of analysis do you do to decide if a certain ETF is a good choice or not?
I've talked about this with some friends, and they've given me quick/easy benchmarks like low management fees, good liquidity, well diversified, etc. But I'm wondering if there's something more in depth one can do?
One thing that I do recognize is that most people picking stocks are aiming to beat the market, while ETFs generally track the market. So maybe an ETF's fundamental analysis doesn't deal with analyzing the stocks in that ETF, but instead deals with analyzing where you think that market will be (e.g. commodities market)? But then how to sift through the noise? Often 10 different sources will give you 10 different answers.
Thanks,
Ari
Not sure if this is the right category for this question but it seemed closest:
If one were to invest (vs. speculate) in a stock, one might do a fundamental analysis of that stock (look at balance sheets, calculate ratios, etc.), but if you want to invest (vs. speculate) in an ETF, what's the "fundamental analysis" of an ETF? It doesn't seem reasonable to just do a fundamental analysis of each constituent in the ETF and add them all up (or I wouldn't spend my time doing that), so what kind of analysis do you do to decide if a certain ETF is a good choice or not?
I've talked about this with some friends, and they've given me quick/easy benchmarks like low management fees, good liquidity, well diversified, etc. But I'm wondering if there's something more in depth one can do?
One thing that I do recognize is that most people picking stocks are aiming to beat the market, while ETFs generally track the market. So maybe an ETF's fundamental analysis doesn't deal with analyzing the stocks in that ETF, but instead deals with analyzing where you think that market will be (e.g. commodities market)? But then how to sift through the noise? Often 10 different sources will give you 10 different answers.
Thanks,
Ari