Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:ETFs Gain Traction in 529 Plans Not Rated 5.0 Email Routing List Email & Route  Print Print
Tuesday, July 10, 2012

ETFs Gain Traction in 529 Plans

News summary by MFWire's editors

State managers of 529 plans are increasingly including ETFs in their portfolios. SmartMoney reports that Nebraska added four new ETFs to three of its 529 plans, New York added six new ETFs to one of its plans, and Nevada's Upromise 529 dropped mutual funds in favor of ETFs. These moves buck the historical trend for the college-savings industry, in which mutual funds have long been dominant.

The move away from mutual funds to ETFs has been facilitated by disappointing and unpredictable returns, market swings, a desire for diversification, and lower fees for plans with ETFs compared to the industry average. Plan managers adding ETFs argue that doing so provides portfolio flexibility and protects against losses.

This new trend has its critics and skeptics. College-savings programs have been seen as long-term investments for decades, and the addition of ETFs to this model may encourage short-sightedness and more risk-taking with active trading.

ETF proponents point to the positive results so far: the Arkansas iShares 529 plan has outperformed its peers, returning an average of 3.3 percent last year, while 529 plans lost an average of almost 1 percent. Investors are opening new accounts with this Arkansas plan more quickly than they have with any other 529 in the past three years. 

Edited by: DW


Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

5.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly




©All rights reserved to InvestmentWires, Inc. 1997-2018
40 Wall Street | 28th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use