How can ETFs be used?

ETFs can be used to implement a variety of short and long-term portfolio strategies.

Some of the uses for ETFs are strategic—for example, asset allocation—while others are tactical. Whether it makes sense to use ETFs in a particular strategy depends on a number of factors, including the dollar amount invested, holding period, trading costs, appetite for risk, and more.

Here are some of the most common ways investors put ETFs to work in their portfolios:

Strategic uses

  • Asset allocation
  • Sub-asset allocation
  • Active and passive combinations

Tactical uses

  • Portfolio completion
  • Cash equitization
  • Risk management
  • Market rotation
  • Currency exposure/diversification

Learn more about ETFs strategies

ETF fundamentals