Exchange-traded funds (ETFs) are one of the most poorly understood investments among Canadians, according to a report by the BMO Wealth Institute.
Just 19% of Canadian investors claim to be knowledgeable about ETFs compared with traditional investments such as GICs (58%) and mutual funds (55%).
However, once told about the benefits of ETFs, 60% report that they would add them to their portfolios.
“Exchange-traded funds have only been around for the last 20 years, so it’s understandable that Canadians are still in the process of familiarizing themselves with them,” says Chris Buttigieg, senior manager, wealth planning strategy, with BMO Financial Group.
But worldwide, more investors are considering ETFs when determining which investments to include in a retirement savings portfolio, the report adds.
A version of this story originally appeared on our sister site, Advisor.ca.