Goldman Sachs Shines Spotlight on ETF Education

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Many money managers including Goldman Sachs have come out with a number of nifty ETF strategies to help investors better customize investment portfolios and access diversified markets. As the industry grows, many players are educating investors and advisors to help meet the demand.

"We have all the resources that we bring to bear from Goldman Sachs as an organization, and from an advisor perspective, what that really means is that we have an entire team of businesses within GSAM that do nothing but work with advisors: portfolio construction, education, business practices. We really help them think about their businesses holistically," Steve Sachs, Managing Director of Goldman Sachs, said at the Inside ETFs 2018 conference.

"From an ETF perspective, we've taken those resources and really focused on ETF education," Sachs added.

For instance, as more investors look to fixed-income ETFs as a way to broaden their portfolio exposure, companies like Goldman Sachs are working closely with advisors to better educate themselves about the mechanics behind these ETF products to more efficiently allocate an investment portfolio.

Many investors may be familiar with how mutual funds work and how they fit into an investment portfolio. However, as more come know about the cheap costs, efficiency and easy of use of the ETF investment vehicle, investors are also going to have questions about how these products work and how to best incorporate these funds into an investment portfolio.

Consequently, more money managers and ETF providers will have to take an active approach in educating investors and advisors about the new products and the subtle differences in each of their respective offerings.

One of the first Goldman Sachs ETFs is the Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF (NYSEarca: GSLC). As a multi-factor ETF, part of GSLC’s objective is to provide investors with a broad basket of equities with the potential to top traditional benchmarks, such as the S&P 500, while removing the need to time individual investment factors.

For more ETF-related commentary from Tom Lydon and other industry experts, visit our video category.

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