NUMBER OF MUTUAL FUNDS AND ETFS VS. US-LISTED STOCKSΔ (Year-end 1980 – 2016)
Source: The World Bank Group, Investment Company Institute. | Notes: Δ Mutual Fund totals do not include funds which invest primarily in shares of other mutual funds. Mutual fund totals represent unique funds and do not count different share classes of the same fund. ETF totals include non-40 Act investment companies such as ETNs.
In 1980 there were 5,164 stocks and 564 mutual funds. As of 2016 the number of stocks declined to 4,331 while the number of funds and ETFs exploded to 9,782, including 8,066 mutual funds and 1,716 ETFs. It’s no wonder investors and advisors are overwhelmed.
Product proliferation has gone well beyond the marginal benefit of a few more choices and some specialization that might benefit consumers. As a result, the answer to basic questions such as “what mutual fund or index should I buy?” has become a quagmire. The situation is made worse by mountains of data and armies of analysts offering even more information and research on every possible investment.
This product overload ultimately creates confusion and anxiety for advisors and investors as they try to navigate the sea of choices and make sense of things. This is where a deep breath and a healthy dose of common sense can be quite useful. It’s important to recognize that there is no silver-bullet investment that everyone must have, and to realize you don’t need every investment that comes down the pike to succeed. In most cases, a handful of thoughtfully selected investments can meet most investors’ needs.
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The information provided here is for general informational purposes only and should not be considered an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. It should not be assumed that recommendations of AthenaInvest made herein or in the future will be profitable or will equal the past performance records of any AthenaInvest investment strategy or product. There can be no assurance that future recommendations will achieve comparable results. The author’s opinions may change, without notice, in reaction to shifting economic, market, business, and other conditions. AthenaInvest disclaims any responsibility to update such views. These views may not be relied upon as investment advice or as an indication of trading intent on behalf of any AthenaInvest representative.
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