ETFs most popular products for US advisers

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ETFs have become the preferred investment vehicle for advisers in the U.S., according to a new report.

A report from the U.S. Financial Planning Association and the Journal of Financial Planning shows more than 80% of advisers in the country use and recommend ETFs for clients, The Wall Street Journal reports. The products outstrip all others, including mutual funds.

According to The WSJ, the diversification benefits and tax efficiency of ETFs has seen them grow over the past decade. In a 2006 survey, only 40% of advisers used them.

"Many investors like that they can look at an index and know, in real time, what securities an ETF is holding. They also like that ETFs are liquid assets. Because ETFs are traded intraday just like stocks, investors don’t have to wait for pricing at the end of the trading day," FPA director of practice management Valerie Chaille wrote in the WSJ.

Chaille urged advisers to be aware, however, of the increasing diversity and complexity of ETFs.

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