Northshore Magazine

P R O M O T I O N ETFs Becoming One of the Most Important Investment Tools of Our Time made a great deal of sense. The list of potential options is unlimited and we should expect the growth in the ETF market to continue as new, innovative ideas continue to be developed. Today the ETF market offers more than 10,000 various ETFs, supported by over 200 providers, and trading on 57 different exchanges, encompassing more than $2 trillion in assets*, with $247 billion in inflow** just this past year. Once in a great while a new innovative product enters the market that truly changes the landscape of how money is managed. When Exchange Traded Funds or ETFs were first introduced in the US by State Street Global Advisors back in 1993, I can remember thinking to myself, "This is going to change everything". The simple concept of breaking the market down into manageable baskets of similar securities AvAILABLE OPTIOnS: Country Specific: China Germany South Korea Commodities: Energy Precious metals Agriculture Industry Sectors: Banks Biotechnology Health Care Market Types: Global Developed Foreign Emerging Frontier Markets Bond Market Sectors: Broad Bond market High-Yield Bonds Ultra-Short Bonds Company Size***: Large Companies Mid-Size Companies Small-Size Companies Geographic Regions: Europe Central America Middle East Robert T. Lutts, President and Chief Investment Officer Security Type: Convertible Securities Preferred Stocks Bank Loans Why own an ETF? Add an ETF search before your next stock purchase: Owning an ETF spreads the risk across a market, an industry, or group of competitors. The biggest benefit is the diversification characteristics of an ETF that help limit losses associated with the risks of owning a single security. Over time, different companies and institutions can and often do lose their competitive edge. An ETF permanently works to always seek out the relevant businesses within a specific investment focus, such as our example of internet media companies. The weaker companies over time are replaced with their stronger competitors. This adaptive quality allows an individual to become a passive investor. No need to be proactive because the ETF will actually adapt to its focused market, allowing the investor to focus on the mix of assets owned, not the minutia really better suited for professional investors. Purchasing Google Inc. common stock (Intended Trade) Research Potential ETF Options: #1) Purchase a broad index that owns Google Inc. → S&P 500 Index #2) Purchase all US Technology Companies → NASDAQ Index #3) Purchase all US Information Technology Companies → Technology Companies #4) Purchase all Internet Media Companies → All Major Competitors Benefits: • Low Ownership Cost • Defined Objective • Transparent • Inter-Day Trading • Tax Efficient 2013 Returns = +58% = +32% = +37% = +31% = +64% JOIn OUR nEWEST WORKSHOP! The ABCs of ETFs: The Proper Use of Exchange Traded Funds Wednesday, March 12, 2014 at 7:00pm Cabot Wealth Management 216 Essex Street, Salem, MA 01970 Seating is Limited. Registration Required. RSvP By March 10, 2014 at info@ecabot.com or 800-888-6468 References: '*ETF Trends, Article Title; ETFGI: ETFs Close to Surpass Hedge Funds in Size, written by Deborah Fuhr, Dated January 6th, 2013 ;** ETF Trends, Article Title; no Surprise Here: Record ETF Inflows in 2013, written by Tom Lydon, Dated January 6th, 2013 '*** Market Capitalization (number of shares outstanding multiplied by the stock price) Cabot Wealth Management is an SEC registered Investment Advisor. Any specific reference to investments in this piece is for informational purposes only and should not be taken as advice. All investments can lose money and past performance is not a guarantee of future results. 216 Essex Street, Salem, MA 01970 11988_CabotManagement.indd 1 | (978) 745-9233 | (800) 888 – MGMT (toll free) | info@eCabot.com | www.ecabot.com 1/17/14 12:15 PM

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