Comment: When is an ETF not an ETF....?

I was first attracted to ETFs by their simplicity and low costs. As a long-standing advocate of indexing investments in efficient, complex and foreign markets for a variety of good reasons, the advent of the ETF was manna from heaven.

Here at last was a freely tradable investment enabling you to buy into Chinese equities or emerging markets shares or the S&P 500 Index at low cost with great flexibility. A good ETF is transparent – it is liquid. You can buy and sell your ETF any minute of the day the markets are trading. If no-one wants to buy it, the manager of the ETF will sell the underlying shares to give you money back based on the value of the portfolio. It is low cost. The fees charged are low by the standards of investment funds, with fees as low as 20 basis points on the biggest markets, rising to 50 or occasi...