RT Journal Article
SR Electronic
T1 Along Came a SPDR
JF ETFs and Indexing
FD Institutional Investor Journals
SP 144
OP 154
VO 2001
IS 1
A1 A. Seddik Meziani
YR 2001
UL http://guides.pm-research.com/content/2001/1/144.abstract
AB Exchange-traded funds (ETFs) are investment tools that can insulate investors from the negative effect of money flows that generate tax liabilities. This study demonstrates that ETFs clearly offer a tax advantage when compared to similar index-based mutual funds, but mostly for investors who favor a buy-and-hold investment strategy. Short-term holders will not benefit nearly as much from ETF tax-efficiency. This study also concludes that there exists an inverse relationship between tax-efficiency and marginal tax rates, with the least affluent investors enjoying most of the tax savings.