Got curious about active ETFs, are they okay for beginners?
I've just been buying KODEX 200, but lately I've heard that active ETFs have good returns. They say there are products that pick dividend or growth stocks, right?
But I heard the downside is that the fees are higher than regular ETFs. If the actual returns are higher, are the fees worth it? Someone who knows, please tell me.
4 answers
Yeah, I was curious too. I've only been doing KODEX 200 and I'm considering switching to active ETFs.
I only invested in KODEX 200 for three years, then last year I switched to active ETFs. There's definitely a noticeable difference in returns. However, the fees are around 0.3–0.5%, so they do add up over the long term. I bought dividend ETFs like SCHD and they turned out to be decent. For beginners, I recommend starting with a small amount to test the waters.
Well... active ETFs don't always stay active. Performance varies significantly between management firms, and after a few years, they often converge to the market average return. Paying higher fees for that, I think it's better to just buy index ETFs. Beginners need to be especially careful.
Oh, I've also been looking into dividend stock active ETFs recently, and I heard 'TIGER US Dividend Dow Jones' is pretty good. But the 0.45% fee gives me pause lol. As for growth stocks, famous ones like ARK are too risky, so I wouldn't recommend them. Also, I'm not sure what you're basing your 'good returns' on—it seems like only a few funds really stand out sometimes.