Last Friday utilities stocks plummeted 3.5% while broader stock market was little changed. This was a good example that utilities stocks act as a combination of stocks and bonds. Factor and correlation analyses confirm this notion.

It is a challenging task to choose the right fund from the ever-growing universe of ETFs. In some cases, there will be an alternative fund available with a lower expense ratio and comparable liquidity.

Measured replacement of mutual funds with ETFs is a move every investor should at least consider. For most mutual funds one can find a substitute ETF that closely matches its performance. This is how.