“ETFs and ETNs are as different as a dog and a cat,” says Steve Hanke, professor of applied economics at Johns Hopkins University. That could leave some investors more exposed to risk than they think they are if they own ETNs. Here’s what investors need to know: Both ETFs and ETNs track the price of things like baskets of stocks, bonds or commodities, but they do so differently. ETN issuers make these risks clear. For instance, some ETN issuers provide collateral for the notes to help reduce the risk to investors.

Source: Wall Street Journal February 06, 2017 03:02 UTC