HH A Guide To The 10 Cheapest ETFs

The global ETF industry is hugely popular and has rapidly been piling up assets in recent years. To be more specific, it took only about two decades to reach $1 trillion in AUM, 23 years to double and just 25 years to hit a record of over $3 trillion at the end of May 2015, as per ETFGI.

This is because ETFs are clearly preferred to mutual funds and hedge funds by virtue of their unique strategies, transparency, diversification benefits, enhanced tax competences, low turnover and low cost. In fact, low cost has been one of the biggest drivers for making the ETFs popular and enhancing their total returns.

While there are several types of cost associated with ETF like trading commissions, bid/ask spreads, premiums and discounts, and tracking error, expense ratios are paid extra attention by investors. This is especially true as ETFs with low expense ratios significantly outperform their expensive counterparts when other factors remain constant. This can be explained by the following example (see: all the ETFs with Low Expense Ratios here)

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