The vaunted diversification offered by exchanged-traded funds (ETF) dilutes your potential upside by offering exposure to a mix of winners and losers. Investors seeking differentiated performance should focus on building a balanced portfolio of individual stocks.
The best investment decisions don’t involve shortcuts. Therein lies the danger of ultra-popular exchange-traded funds and exchange-traded notes (ETN). The promise of diversified, one-stop exposure to a sector, industry or strategy can obscure the disadvantages associated with these investment vehicles.
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