Given the broad adoption of exchange traded funds and the financial media attention to their potential risks and pitfalls, we review advisors’ self-rated knowledge of the most important aspects of ETFs. Survey results portray clear differences between knowledge areas and indicate details in which practitioners feel they could use education. Notable subjects for improvement in advisor knowledge are the intraday value calculation, distribution schedules, and character of distributions. All of these details are relatively technical aspects of ETFs and advisors can arguably be forgiven for not being experts in such matters, but as more creative and alternative ETFs are launched, advisors would be wise to better understand the underlying details. Aspects such as liquidity, trading, and investment methodology, which receive a lot of attention in the financial media, are relatively well-understood by advisors, with response rates ranging from 17% to 21% of advisors stating they have below average knowledge across these three aspects.
