A version of this article previously appeared in the July 2019 issue of Morningstar ETFInvestor. Download a copy here.
Big exchange-traded funds get more than their fair share of attention. The largest 10% of U.S.-listed ETFs carried about 86% of all assets invested in such funds at the end of May 2019. Investors are generally proficient at seeking out better funds. The asset-weighted performance of equity and fixed-income ETFs consistently beats their equal-weighted performance, largely because the lowest-cost funds soak up a disproportionate share of assets.
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Alex Bryan does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.