What’s the appeal of ETFs, and how should you use them?

FundX Chief Investment Officer Jason Browne answered these questions on the Nightly Business Report on November 10, 2017.

He also shared three ETFs that have strong recent returns because funds that have done well recently may continue to do well in the coming months or even years.

Click here to watch Jason on NBR.

“We use ETFs as we use any other mutual fund,” Jason said. “Even though you can trade ETFs at any time usually you do so at your own peril.”

Many investors like ETFs because they offer diversified exposure to different areas of the market and make it easy for investors to adapt to changing trends, Jason noted.

Investors should remember that most ETFs track an index, so ETF managers don’t get to pick which stocks they might want to include or exclude.

Three ETFs with Strong Recent Returns

If you’re looking to own ETFs that are in favor now, here are three diversified ETFs that have strong recent returns. Continue reading “FundX CIO Jason Browne Talks ETFs on Nightly Business Report” »

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November is the time to start preparing for the end of the year. December is busy for everyone, so use November to get a head start.

This what we’re doing for our money management clients in November: we’re paying attention to the early estimated year-end distributions from mutual funds, and looking for ways to reduce taxes.

We’re also making sure clients take their required minimum distributions (RMDs) and updating their retirement contributions and withdrawals.

You can do the same in your portfolio. Set aside some time now to make your year-end plans. It’ll give you more peace of mind during the holidays and help you start the New Year off right.

Here are the five key things every investor should do in November:

1. Prepare for Mutual Fund Distributions

November marks the start of fund distribution season. Nearly all stock funds distribute capital gains and income to shareholders at the end of the year. Most funds distribute in December, but some funds make payouts in November, including Ariel, Artisan, Baron, Hussman, Leuthold and Parnassus.

If you own funds in a taxable account: distributions are taxable to you whether you take them in cash or reinvest them in new shares, so trade carefully this time of year.

Before buying a fund this month, check with the fund to see if it plans to make a distribution. You may opt to buy ETFs, since most ETFs don’t pay out capital gains, and most distribute income quarterly.

If you invest in a tax-deferred account like an IRA or 401(k): you don’t need to worry about the tax implications of distributions. But you should still be aware of them when looking at a fund’s performance: a fund’s NAV or share price drops by the amount of the fund’s distribution. This can look like a fund has sold off sharply when, in fact, the fund simply distributed some assets to its shareholders.

Returns in NoLoad FundX are adjusted for distributions, but reporting services like Yahoo Finance don’t always factor in a fund’s distributions, so it may look like your fund has lost money when it really hasn’t.

Where to find distribution information: We collect estimated distribution information for hundreds of funds, and we share this information with FundX members in the the December issue of NoLoad FundX newsletter along with tips on what to do if a fund you own is planning to make a big distribution.

2. Harvest Losses in Taxable Accounts

Continue reading “Get a Jump-start on Year-end Planning” »

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