Understanding the Difference Between ETFs and ETNs

November 17, 2011

Ron Rowland explains the differences between exchange-traded funds and exchange-traded notes, and highlights the main drawback of ETNs – that you’re essentially lending money to the issuer, and hoping that it doesn’t go bankrupt.

 

{ 1 comment… read it below or add one }

1 Karen Lodinger November 17, 2011 at 4:27 pm
Are the currency ETF’s, such as FXA, safe from contagion? Is there the possibility that these funds could be taken from the shareholder due to insolvency by any of the managing parties, Trustees, etc? My goal is to invest in Australian dollars. Am I taking on risk by not owning the currency outright thru any of the associations of the ETF? Thank you, Karen

Reply

Leave a Comment

You can use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Copyright © 2012 Weiss Research, Inc.