Several years ago, I started adding ETFs to my own portfolio. As the number of ETFs has grown, so has my personal use of them.

Don't get me wrong, I still own individual stocks and mutual funds, but an increasingly greater proportion of my portfolio is allocated to ETFs. The reason is that there are several advantages that make ETFs very attractive.

ETFs Are Less Expensive Than Mutual Funds

The majority of mutual funds are actively managed, which means investors not only have to pay for a fund manager, but also a staff of analysts.

These expenses hurt your return. This wouldn't be a problem if the performance was spectacular, but it's not. According to Standard & Poor's, 71.9% of actively managed large-cap funds underperform the S&P 500. So while there are some funds that are worth paying extra for (and the Zacks Mutual Fund Rank will help you

Several years ago, I started adding ETFs to my own portfolio. As the number of ETFs has grown, so has my personal use of them.

Don't get me wrong, I still own individual stocks and mutual funds, but increasingly, a greater proportion of my portfolio is allocated to ETFs. The reason is that there are several advantages that make ETFs very attractive.

ETFs Are Less Expensive Than Mutual Funds

The majority of mutual funds are actively managed, which means investors not only have to pay for a fund manager, but also a staff of analysts

These expenses hurt your return. This wouldn't be a problem if the performance was spectacular, but it's not. According to Standard & Poor's, 71.9% of actively managed large cap funds underperform the S&P 500. So while there are some funds that are worth paying extra for (and the Zacks Mutual Fund Rank will help