Is the All-ETF Portfolio a Good Idea? What Investors Should Know

As the exchange-traded fund craze continues, can it be long before all-ETF portfolios are yesterday's headline? Probably not. Why? Maybe it's the fact that ETFs often have lower expense ratios versus active and passive mutual funds. They are also transparent, trade throughout the day and, because they are known for avoiding taxable year-end capital gains distributions, they don't monkey with your tax planning. Such factors make ETFs one of the easiest ways to diversify a portfolio, says Wayne Connors, principal at 3D Asset Management.